This year's budget has been cut in half
Written by Wang Lei and Truman
More than 1 5 of the money GM earns from selling cars is used to fill the hole in autonomous driving.
In 2023, GM will earn $10.1 billion, but its autonomous driving company, Cruise, will spend $1.9 billion (about 13.6 billion yuan) a year.
To make matters worse, cruiseThe pre-tax loss was $2.7 billion, which does not include the $500 million in restructuring costs incurred due to layoffs in the fourth quarter.
GM, which has high hopes for autonomous driving, can no longer hold on, and has just announced at the earnings conference that it will reduce the budget for cruiseto $1 billion
GM CEO Mary Barra has previously said that Cruise has a "huge growth opportunity"* to generate $50 billion in annual revenue by 2030.
Now it is obviously far away from the time point of profitability, Cruise, which has been established for 10 years, has been acquired by GM for almost 8 years, and the speed of making money in these years is far from keeping up with the speed of spending, and even the wealthy General Motors has to re-examine this business.
Huge investments have yielded little results
General Motors, the largest automaker in the United States, recently released its 2023 financial report, with a net income of$171.8 billion(RMB about 1.)23 trillion), a year-on-year increase of about 10%, a record high.
In 2023, GM's net profit will be $10.1 billion, a year-on-year increase of 19%, adjusted EBIT reached $12.4 billion, officials said it exceeded financial expectations for three consecutive years, and adjusted cash flow from the automotive business was also as high as $11.7 billion.
The business is very good, but the only thing that can be worried about autonomous driving is worried.
GM said that its autonomous vehicle division, Cruise,$1.9 billion in cash burned in 2023, totaling a pre-tax loss of nearly $2.7 billion for GM.
These losses do not include the $500 million in restructuring costs incurred due to layoffs in the fourth quarter, and if you add that $500 million, Cruise's losses are ridiculously high.
GM has said it will invest $2 billion a year in its autonomous driving unit, Cruise, and plans to cut it in half this year.
Cruise has not announced specific revenue and expenses for 2023, but on the day of GM's earnings conference, Cruise asked the California Public Utilities Commission to accept its settlement offer for the previous accident and made it7.$50,000 in compensation
Mary Bora said that Cruise's spending this year will focus on retaining talent in software and engineering, and the implication is that retaining talent and stabilizing the morale of the military is the most important thing right now.
With plans to expand its robotaxi business to 20 cities on hold, GM also doesn't need to spend too much on vehicles and operating staff.
For a long time, Cruise's autonomous driving business has burned more money than car manufacturing, and the money that GM has invested in Cruise over the years is likely to beMore than 10 billion dollars
What can be solved with money is trivial, and what is even more troublesome is that Cruise is frequently involved in traffic accidents and is investigated, which also leads to the fact that Cruise self-driving taxis are still far away from being back on the road.
Mary Bora said at GM's earnings conference that it would ".Refocus and relaunch cruisesThe company will announce a timeline for the resumption of operations "soon".
So although GM has reduced its spending on cruise, it has not completely given up. On the contrary, Mary Bora has always been firmly optimistic about and supportive of Cruise, and at the just-concluded meeting, she also emphasized that Cruise will set a higher safety standard for its self-driving software than human drivers.
While Cruise was under investigation, Birla expects Cruise to be more cautious in its pace of expansion once operations resume, specifically notingGM still believes in Cruise's technology and team, will ensure that the cruise meets "strict safety requirements". "I understand people's concerns about the deployment of funds. Whether it's from a societal or security perspective, I think it's a technology that's important for the future, and it has to be done right. ”
GM CFO Jacobson has also previously said that GM is committed to turning around the troubled Cruise autonomous driving business.
Technical deficiencies are the core cause
Almost at the same time as this earnings report, there was also a third-party accident investigation report from Cruise.
In this investigative report, Cruise admits two deficiencies, one is:The software algorithms are really flawed。(But it was updated in November last year) and there isCruise executives are poorly supervised and deliberately conceal the facts to avoid the most important things, which led to a crisis of confidence among the population.
However, GM has reorganized the top management of Cruise, and there are already thatNine senior executives leftAmong them were Kyle Vogt, who was CEO at the time, Gil West, chief operating officer, and Jeff Bleich, chief legal officer.
Cruise's current leadership team.
Let's briefly recap the accident that caused the Cruise Building to collapse.
On the night of October 2 last year, a female pedestrian was hit by a human-driven sedan and subsequently rolled down the driveway. At this time, one of the Cruise's Robotaxi did not avoid it, but instead hit the pedestrian again, and then applied emergency braking, at which point the pedestrian was already swept under the car.
However, after the vehicle came to a standstill, the command to pull over was activated, and the pedestrian was forcedDragged 6 metersThe distance caused him to suffer serious injuries all over his body.
By the time the San Francisco fire department arrived at the scene, the Robotaxi had stopped, but the victim of the accident was still crushed under the car, and finally used tools to rescue the victim from under the wheels, and the driver of the sedan that initially hit the pedestrian had fled by car.
According to the statement of the third-party accident investigation report, the core reason for such an operation is technical defects.
In the investigation report, the vehicle's reaction decision at the time of the accident was reconstructed, and before the accident, the pedestrian was hit by another vehicle in the adjacent lane and thrown into the lane driven by the cruise's robotaxi.
The Robotaxi didn't cause an accident, but it did detect that someone had been hit and slowed down slightly three-quarters of a second before hitting the pedestrian.
But when the pedestrian is thrown into the lane of the Cruise car, he is already in a fallen state, and most of his body, except for his legs, is out of the range of LiDAR perception, that isOnly the legs of the whole body appear in the range of the cruise lidar
But from the impact to the final stop, the pedestrian's feet and calves are visible in the wide-angle camera on the leftAlthough the perception system detected it, the lidar did not identify and track it
So this also leads to the fact that the cognitive logic of the cruise car makes it wrongClassified as a side impact rather than a frontal impact, made the decision to pull over, and then continued to drive for an opportunity to pull over, resulting in the pedestrian being towed under the vehicle for nearly 6 meters.
The report also pointed out that the vehicle should have stopped immediately in the driving lane because the right side was a bicycle lane, but under the recognition of cruise, the bicycle lane on the right was identified as a motor laneSinceThe roadway is separated from the motorway by a white railing, causing Robotaxi to make the decision to pull out of the white railing area and pull over, which aggravates the injury to pedestrians.
From this accident report, it can be concluded that the root cause of the accident is that the cruise recognition algorithm is indeed defective, and the Robotaxi failed to correctly identify pedestrians and made wrong decisions, which aggravated the damage of vehicles to pedestrians.
In the face of the problems pointed out in the report, the next day, Cruise said in a blog post that they had updated Robotape's software to fundamentally solve the problem of not being able to correctly identify pedestrians.
But in fact, what threatens the survival of this Robotaxi company is not only the technical flaws, but alsoCruise's moral crisisIt became an intolerable problem.
In the face of investigations, the deliberate withholding of key information by regulators and the trivialization of the regulators have also been trivializedAlmost all of the top management has been laid off
And GM was affected by the cruise accident and began to replan its advanced driver assistance systems (ADAS) program. DirectlyThe ultra cruise, an advanced intelligent driver assistance system, was suspendedand its team members were merged into the Super Cruise project, merging the two projects into one.
It is worth mentioning that this project was once seen by GM as a potential competitor to Tesla's FSD beta. But it's a pity that one wrong step, every step has to be wrong.
How far is the unmanned car business from maturity?
Skepticism about the robotaxi model reached its peak after Cruise went through a series of accidents.
The current unmanned vehicle project is like a hot potato for car companies, not only is it difficult to land, but also keeps investing money, and it cannot be completely abandoned.
Not only GM has begun to cut its budget, but Aptiv, a leading auto parts company, is also planning to cut losses in time.
Aptiv recently decided to take a stake in Motional, a joint venture in autonomous driving technology, and not to invest further in Motional. Previously, Aptiv had already lost money due to its investment in MotionalMillions of dollars
Kevin Clark, CEO of Aptiv, said at the earnings call, "While our joint venture, Motional, continues to make progress on its technology roadmap, we haveIt was decided not to invest any more money in it
Aptiv is currently pursuing alternatives to reduce the ownership interest. Kevin Clark said that from an adoption perspective in the mobile supply and demand market, it would be too expensive to provide technical support on the hardware side alone.
In other words, it would be too expensive to set up a robo-taxi service, and the time to regain those precious funds would be too long for Aptiv.
In addition, before the cruise accident, it was backed by Ford and Volkswagen, two leading international car companiesArgo AI has gone out of business, and Waymo is also to survive, cutting costs as much as possible.
Even Aurora, which once acquired Uber's unmanned vehicles, has formulated a series of cost reduction plans, including a hiring moratorium and multiple layoffs, and Aurora is even considering privatizing the company, spinning off or ** assets, and conducting small-scale financing.
After years of money-burning wars, investors "can't wait" and many practitioners are "conservative", gradually making it from "Britney" to "Mrs. Niu".
But there is never a shortage of players for RoboXis, and once it is successfully landed, it will bring huge profits.
It's just that no one dares to guarantee the ticket no matter how much they step through the door.