GM Losing $5M a Day on Self-Driving Car Project
Rising labor costs and operational setbacks are somewhat to blame
GM is losing $5 million a day on its self-driving car project
Rising labor costs and operational delays are partly to blame
General Motors’ losses at its self-driving subsidiary Cruise are mounting.
The automaker confirmed that it lost more than $500 million in the second quarter of the year, or $5 million a day.
While Cruise has seen some visible growth in 2022, notably getting approval from the California Public Utilities Commission to start charging for driverless rides in San Francisco, and then a commercial robotaxi service when it actually launches, the numbers provide a clear understanding of the long road to profitability. autonomy. vehicle face (AV).
The huge investment required to get to this stage, where Cruise only operates one service in a major US city, shows the automakers’ struggles.
In fact, Cruise’s losses for the first six months of the year were $900 million, which is $300 million more than the $600 million lost in the first six months of 2021. One of the reasons for the increase is increased employee costs with the expansion of cruise operations.
While these numbers are alarming in isolation, Cruise is not in immediate danger, billions of dollars are still available. And GM CEO Mary Barra remains optimistic about AV’s future potential, telling investors that the self-driving unit could generate $50 billion in annual revenue by 2030.
“When you have an opportunity to enter a $1 trillion market where you can have a very different technology and product, you can’t take that lightly,” said Cruise CEO Kyle Vogt. “You attacked it aggressively.