The year had started so well for robotaxis. Cruise and Waymo came into 2023 riding high on fresh investments from General Motors and Google, respectively, as well as rapidly growing interest from the general public and a downright rabid rate of adoption by city governments. Things were looking up, very up, for the burgeoning self-driving vehicle industry! Then a driverless Crusie taxi accidentally dragged a hit-and-run victim down a San Francisco street for a few dozen feet and everything just sort of went to shit from there. So fragile, these Next Big Things. Let’s take a look back through the year that was to see how autonomous taxi tech might recover from this catastrophe.
Cruise (Out of) Control
Cruise came into this year looking like a nigh-on unstoppable force of transportational change as the core of GM’s self-driving efforts. The company received a $1.5 billion investment from the automaker in March 2022 after GM spent $2.1 buying equity ownership for the startup from Softbank Vision Fund. In February the company announced that its test fleet of driverless taxis had traveled a million miles of San Francisco’s streets without a human behind the wheel. The program had only started the previous November.
“When you consider our safety record, the gravity of our team’s achievement comes into sharper focus,” Mo Elshenawy, Cruise’s EVP of engineering, said in February. “To date, riders have taken tens of thousands of rides in Cruise AVs. In the coming years, millions of people will experience this fully driverless future for themselves.”
Cruise CEO Kyle Vogt had been installed at his position in December 2021 after GM CEO Mary Barra ousted Dan Ammann from the spot. Vogt spent the following year laying out a grand vision of “zero crashes, zero traffic, and zero emissions,” though, according to a November report from the New York Times, the company “put a priority on the speed of the program over safety” during his tenure, cutting corners on safety in order to get more vehicles on the road. And expand Cruise did, into Houston and Los Angeles most notably, despite a growing number of traffic incidents and accidents left behind by its vehicles.
In April, the company was given permission to operate its driverless vehicles throughout San Francisco, 24/7 as well as pick up paying passengers during daylight hours. Previously, only Cruise employees were allowed to ride in the robotaxis and they could only operate when the sun was out. In August, the California Public Utilities Commission (CPUC) voted 3-to-1 in favor of allowing Cruise (and Waymo as well) to to pick up paying passengers at all hours.
Not everybody was fully on board with the robotaxi takeover, mind you. In January 2023, San Francisco officials requested the CPUC slow or even halt the expansion of self-driving vehicle services in the city, arguing that the free-for-all growth OK’d by state regulators was becoming an “unreasonable” burden. In fact, barely a week after the CPUC voted in favor of expansion, the California DMV opened an investigation into an altercation between a Cruise taxi and a fire truck. In response, the DMV had Cruise cut its operating fleet in half — down to 50 vehicles during daylight hours and 150 at night — until it had completed its investigation. Then there was the whole “using robotaxis as love hotels” issue in August.
(1/3) At approximately 9:30 pm on October 2, a human-driven vehicle struck a pedestrian while traveling in the lane immediately to the left of a Cruise AV. The initial impact was severe and launched the pedestrian directly in front of the AV. — cruise (@Cruise) October 3, 2023
Those mishaps were bad. The events of October 3 and Cruise’s response to the resulting investigation proved unforgivable. As the company initially explained in the above thread, a human-driven vehicle struck a pedestrian, pushing her into the path of the Cruise taxi in the lane to her right. The taxi ran the woman over, despite aggressively braking, and ended up dragging her 20 feet until coming to a stop. EMS crews were able to extract the pedestrian from underneath the taxi using the jaws of life, and rushed her to medical treatment with critical injuries.Though she has not been identified, the pedestrian was reportedly in serious condition as late as October 25.
If that weren’t bad enough, Cruise then allegedly misled regulators about when the taxi engaged its brakes — telling them that the taxi had stopped immediately, not eventually, after slowly traveling another 20 feet down the block. The company then repeatedly delayed in releasing video of the incident to investigators until October 19.
The company’s cover-up efforts puts Cruise in financial jeopardy with the CPUC, which is currently considering fining it as much as $1.5 million for its obfuscating actions. The Commission’s decision will be made in early February at an upcoming evidentiary hearing.
More immediately, the accident itself set off a whole slew of investigations, regulatory and internal alike. The Exponent consulting firm was brought in as an independent investigator and promptly dredged up some rather unflattering data regarding the robotaxis’ difficulties with spotting and reacting to the presence of small children. That revelation wasn’t so bad, at least compared to the company’s decision to keep the vehicles on the road even after being informed of the potentially deadly defect.
The California DMV was not amused and, two weeks after the accident occurred, the department suspended Cruise’s license to operate within the state, effectively shuttering its robotaxi operations. That’s a huge blow to GM, which has sunk billions into the startup and was anticipating the robotaxi service to generate as much as $5 billion annually when operations were to begin in 2025. In mid-November, the company recalled all 950 of its autonomous taxis in operation, and even paused robotaxi rides with human safety drivers behind the wheel a week later, as part of a “full safety review.”
Then things got even worse. On November 18, CEO Kyle Vogt announced his resignation from his position a week after GM installed EVP of Legal and Policy Craig Glidde (who was already a Cruise board member) as Chief Administrative Officer. The following day, company co-founder and Chief Product Officer Daniel Kan also announced his departure.
In response to Vogt’s departure, GM promoted Mo Elshenawy from EVP of Engineering to the dual role of President and CTO, leaving the CEO position currently vacant. GM CEO Mary Barra told reporters recently that the company has “a lot of confidence with what the two co-presidents will do,” but will be “leaning in to make sure that it meets our strict requirements from a safety perspective.”
GM suddenly found itself holding the multibillion dollar bag, so it cut off funding near immediately, slashing budgets to the tune of “hundreds of millions” of dollars. As a result, Cruise has since suspended its equity program and begun laying off employees, starting with those in autonomous vehicle operations.
“The most important thing for us right now is to take steps to rebuild public trust,” Cruise said in a statement. “Part of this involves taking a hard look inwards and at how we do work at Cruise, even if it means doing things that are uncomfortable or difficult.”
But Cruise isn’t entirely dead yet, as Elshenawy explained in a recent email to staff. The company plans to scale back its self-driving ambitions and relaunch with a renewed focus on the current Chevy Bolt AV robotaxi platform, rather than its custom-built Origin vehicle. As such the company is pausing production on the Origin at least through 2024 but does plan to continue the program at some point in the future.
Waymo Money, Waymo Problems
Waymo entered 2023 in much the same way as Cruise did: riding high on the hype and promise of self-driving vehicle technology. However it is ending the year in a very different place from its biggest competitor.
Google-backed Waymo had received glowing praise from Swiss RE, a leading global reinsurer, regarding the safety of its vehicles versus human drivers the previous September, and had just launched its second Waymo One taxi service area that December, this time in Phoenix, Arizona, running a route between downtown and the Phoenix Sky Harbor International Airport.
Following a rigorous cycle of validation and safety readiness evaluation, @Waymo is starting fully-autonomous (no human driver) testing in LA. Thrilled by the data confirming, once again, how well our ML-based 5th-gen Driver generalizes across cities! pic.twitter.com/hd0XU5zecT — Dmitri Dolgov (@dmitri_dolgov) February 27, 2023
Los Angeles joined Waymo’s stable of cities in February. Much as it was rolled out in San Francisco, Waymo’s self-driving vehicles were initially made available only to riders who were part of the Waymo Research Trusted Tester program in a limited area (in this case, Santa Monica), always outside of rush hour and only in limited numbers.
The following month the company launched a similar effort in Austin, Texas, a town where it had conducted some of its earliest self-driving tests back in 2015. Austin is a hot town to test self-driving vehicles in, on account of a 2017 state law that prevents cities from locally regulating the technology’s use and deployment on their streets.
Things were going so well for Waymo come summer that the company announced it would shift gears, pushing back plans for its self-driving truck idea to instead focus fully on its expanding robotaxi service.
“Given the tremendous momentum and substantial commercial opportunity we’re seeing on the ride-hailing front, we’ve made the decision to focus our efforts and investment on ride-hailing,” Waymo co-CEOs Tekedra Mawakana and Dmitri Dolgov wrote in a July blog post. “We’re iterating more quickly than ever on our technology by pushing forward state of the art AI/ML, and seeing significant business growth and rider demand in San Francisco, Phoenix, and Los Angeles.”
By August, Waymo announced that Austin would be joining those towns as the fourth city to host its autonomous taxi service, with the program rolling out through the Fall. That same month, Waymo received its driverless deployment permit from the California Public Utilities Commission (CPUC), enabling the company to begin charging passengers for its robotaxi rides as well as expanding the service to additional customers. Previously, the company could only charge for rides if a human safety driver was behind the wheel. The company acknowledged at the time that demand was “incredibly high” (signups had already reportedly passed 100,000 users) but that it was working to make its fully autonomous trips “available to everyone over time.”
“Things are growing… The ridership is increasing in both Phoenix and SF,” he continued, noting that the company provides more than 10,000 trips per city each week. Overall, it would have been a pretty great year for Waymo — especially after chief rival, Cruise, effectively imploded over the course of Q4 — had the company’s workforce not been subject to not one, not two, but three rounds of layoffs impacting over 300 employees.
The Road Ahead for Robotaxis
As we head into the new year, Waymo is effectively the only game in town, now that Cruise isn’t a viable commercial entity for the foreseeable future.
Midway through the year, analysts predicted the robotaxi market, valued at just over $1.1 billion in 2022, could rise to anywhere from $45.7 billion in 2030 to $118 billion in 2031 citing, “increasing demand for shared transportation, advancements in vehicle technology, growing interest in fuel-efficient public transportation, and improved infrastructure.”
Those outlooks have been tempered in recent months, at least for short term estimates, with Cruise temporarily out of the picture. Forrester Analytics, for example, now expects drone delivery services to become the dominant self-driving vehicle segment in 2024 as pushback from regulators slows development of robotaxi transit tech.
“Expect a booming year for self-driving forklifts, curbside delivery robots, and drone delivery, driven by the increasing popularity of e-commerce, the need for last-mile delivery solutions, and more sophisticated autonomous technologies,” wrote Craig Le Clair, Vice President and Principal Analyst at Forrester.
We are, of course, still waiting on those million robotaxis Elon Musk promised us back in 2019.
2023 was the year Cruise’s robotaxi dream came to a crashing end
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