The US auto giant lost 3.3 billion in autonomous driving and will lose 33 million every day

On July 26, local time, General Motors announced to the outside world that the Cruise department's business losses in the second quarter reached US$500 million (approximately RMB 3.3 billion), more than US$5 million (approximately RMB 33 million) a day. Since 2018, General Motors has lost nearly US$5 billion in order to deploy commercial autonomous driving business in San Francisco, USA. Now as the company's Cruise department begins to charge rides, the losses are still accelerating.

Cruise has made great efforts to transform autonomous driving technology from a long-term research project into a profitable business. However, the market signals are not good. Affected by the economic environment such as global inflation, investors are reducing their bets on technology risks and re-evaluating the specific situation of large-scale deployment of autonomous vehicles on public roads.

Shares of self-driving car technology company Aurora Innovation Inc (AUR.O) have fallen 80% so far this year as automakers including Ford Motor Co (FN) scaled back investments in their self-driving car units or sought partners to share costs.

In the first half of 2022, Cruise's losses reached $900 million, compared with a loss of $600 million in the same period last year, when it had not yet charged for rides. GM executives said the main reason for the significant increase in losses was that after shelving its listing plan, the company increased its salary by paying additional wages to retain employees, resulting in higher salary costs.

Chief Executive Mary Barra said Tuesday she remains bullish on Cruise and reiterated her optimistic forecast that the Cruise unit could generate $50 billion in annual revenue from self-driving car services and technology by 2030.

But whether it can reverse its losses depends on factors beyond GM's control, such as whether it can win approval from California regulators to significantly extend Cruise's operating hours and expand the coverage area of ​​its self-driving taxis.

Cruise applied to U.S. auto safety regulators in February for an exemption to deploy 2,500 self-driving cars without human controls such as steering wheels and brake pedals. The National Highway Traffic Safety Administration (NHTSA) published the application last week and is open to public comments for 30 days.