High costs and regulatory crackdowns! Volkswagen abandons autonomous taxi business

As competition in the autonomous taxi sector intensifies, General Motors has withdrawn. On Tuesday, General Motors announced that its autonomous vehicle division Cruise will exit the robotaxi business, and Cruise will merge with General Motors' technology team to focus on developing autonomous driving and advanced driver safety technologies. General Motors stated that due to the time and resources required to expand the business, as well as the increasingly fierce competition in the robotaxi market, it will no longer provide funding support for robotaxi development in the future. This move comes as Alphabet's Waymo expands into more cities and Tesla plans to launch its robotaxi business in 2026. Previously, General Motors CEO Mary Barra had planned to double the company's revenue by 2030, which included achieving $50 billion in revenue through Cruise. However, without the fare revenue from the robotaxi business, this goal has become even more elusive. Analysts believe that terminating robotaxi development is expected to save General Motors over $1 billion annually, allowing the company to focus more on its core business of manufacturing and selling vehicles. In the context of continuously evolving autonomous driving technology, General Motors may secure a place in the future automotive market by concentrating on its core business and technological innovation. This withdrawal also marks the end of a turbulent period for Cruise. Previously, following a traffic accident that resulted in pedestrian injuries, Cruise faced severe regulatory scrutiny, with California revoking its passenger and charging permits, and the company temporarily halting its fleet operations nationwide. Shortly after the incident, Cruise founder Kyle Vogt resigned, and the company subsequently fired nine executives and laid off 25% of its staff. According to reports, General Motors will also repurchase Cruise's shareholder equity and, through agreements with other shareholders, increase its stake in Cruise from 90% to over 97%. After-hours trading saw General Motors' stock price rise nearly 2%.