Latest / Elon Musk Podcast / GM Abandons Robotaxi Race as Tesla Charges Ahead with Self-Driving Plans

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GM Abandons Robotaxi Race as Tesla Charges Ahead with Self-Driving Plans · Elon Musk Podcast

• 0:01
  Hey everybody, welcome back to the Elon Musk Podcast.
• 0:05
  This is a show where we discuss the critical crossroads that
• 0:08
  shape SpaceX, Tesla X, The Boring Company and Neurolink.
• 0:13
  I'm your host Will Walden. General Motors announced Tuesday
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  a fundamental restructuring of its autonomous vehicle strategy,
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  abandoning its robotaxi ambitions to concentrate on
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  developing self driving tech for personal vehicles.
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  Now this pivot marks the end of GM's high profile bet on Cruise
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  LLC, its majority owned subsidiary that aim to
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  revolutionize urban transportation through
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  driverless taxis. Now the decision sends ripples
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  through the auto industry as GM, America's largest automaker,
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  moved to consolidate its autonomous driving efforts under
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  a unified structure. The company plans to merge
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  Cruises technical teams with GM's existing autonomous vehicle
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  division, creating a single focused unit dedicated to
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  advancing driver assistance systems and autonomous
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  capabilities for consumer vehicles.
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  Now, Mae Bera, who's GM's chair and chief executive officer,
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  framed the decision within the company's broader strategic
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  vision, She said. GM is committed to delivering
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  the best driving experiences to our customers in a disciplined
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  and capital efficient manner. Now, this shows that the
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  company's determination is to maintain its position in the
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  evolving automotive landscape while managing resources more
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  effectively. Now, the financial implications
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  of the strategic shift are substantial, the GM projecting
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  annual sales exceeding a billion dollars once the restructuring
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  concludes in the first half of 2025.
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  The cost reduction comes at a crucial time for the automotive
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  giant, which has invested heavily in autonomous technology
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  development over the past decade.
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  Now Cruise employees learned of this shift during a hastily
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  arranged all hands meeting Tuesday morning, where senior
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  leadership, including the CEO Mark Witten, delivered the news.
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  The announcement left many workers surprised and uncertain
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  about their future roles, particularly those in non
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  engineering positions related to robotaxi operations.
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  The restructuring arrives after a series of setbacks for Cruise,
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  most notably an October 2023 incident where one of the
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  autonomous vehicles dragged and injured pedestrian in San
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  Francisco. Now this event triggered intense
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  regulatory scrutiny and led to the suspension of Cruises
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  operating permits in California, forcing the company to ground
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  its entire US fleet. Now G Miss ownership stake in
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  Cruise will increase from approximately 90% to more than
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  97% through arrangements with other shareholders pending the
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  completion of share repurchases and Cruise Board approval.
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  The consolidation of ownership strengthens G Miss control over
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  the direction of its autonomous driving development and David
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  Richardson, who is a Senior Vice President of Software and
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  Services, Engineering and GM, so that the company's ongoing
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  dedication to autonomous driving technology is real, he said.
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  We are fully committed to autonomous driving and excited
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  to bring GM customers its benefits.
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  Things like enhance safety, improve traffic flow, increased
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  accessibility and reduced driver stress.
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  Now, the company's renewed focus on personal vehicles builds upon
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  the success of Supercruise, GM's Hands off Eyes on Driving
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  feature. This technology currently
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  operates on more than 20 GM vehicle models and logs over 10
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  million miles monthly, demonstrating strong consumer
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  adoption of advanced driver assistance technologies.
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  And this strategic pivot occurs against the backdrop of
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  intensifying Commission in the autonomous vehicle sector.
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  Alphabets Waymo continues its expansion into additional
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  cities, while Tesla announces plans to launch its own robo
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  taxi by 2026, creating pressure on traditional automakers to
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  adapt their autonomous driving strategies.
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  Now the decision represents a significant departure from GM's
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  earlier ambitions. 2021 the company projected that Cruise
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  would deploy 10s of thousands of custom built origin taxis,
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  potentially generating $80 billion in annual revenue by
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  decade's end. Now these targets now give way
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  to more immediate consumer focused objectives.
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  The transformation of Cruz's operations will likely result in
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  workforce changes, particularly affecting teams involved in
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  government affairs, communications, ground
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  operations and remote assistance in cities where Cruz had resumed
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  testing such as Phoenix, Houston and Dallas.
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  And prior to this announcement, Cruz had received an 80 or $850
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  million investment from GM in June of 2023 intended to support
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  the relaunch of robotaxi testing in select markets.
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  The company has been established a with a partnership with Uber
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  to introduce robotaxis on the ride handling platform by 2025.
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  Now plans now rendered obsolete by this new shift and the
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  restructuring effects numerous partnerships and agreements
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  including the recently announced collaboration with Uber.
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  These relationships must now be re evaluated within the context
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  of GM's new focus on personal vehicle autonomy.
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  Now market reaction to the announcement was positive, but
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  GM stock price raising 2.7% in after hours trading, suggesting
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  investors support the company's decision to streamline operation
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  and reduce expenses in its autonomous vehicle program.
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  And GM decision to refocus on personal vehicles aligns with
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  current market dynamics and consumer preferences, while
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  potentially offering a more direct path to commercialization
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  of autonomous driving tech. Now.
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  This approach leverages the company score strengths in
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  vehicle manufacturing and distributing.
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  And the transformation of GM's autonomous driving strategy is
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  best for the broader industry as challenges in developing and
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  deploying self driving technology are huge.
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  Technical hurdles, regulatory requirements, and market
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  dynamics continue to shape the evolution of autonomous
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  vehicles. Hey, thank you so much for
• 6:19
  listening today. I really do appreciate your
• 6:21
  support. If you could take a second and
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  hit the subscribe or the follow button on whatever podcast
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  platform that you're listening on right now, I greatly
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  appreciate it. It helps out the show
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  tremendously and you'll never miss an episode.
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  caught up quickly. And please, if you want to
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  support the show even more, go to patreon.com/stage Zero.
• 6:45
  And please take care of yourselves and each other.
• 6:47
  And I'll see you tomorrow.