If you look at it from an outside point of view, right now Tesla is worth $1.6T, Waymo is worth $130B, and GM is worth $72B. If Cruise were actually a third viable competitor in this race, it would probably be worth more than the rest of GM. Self-driving is just a far more valuable business than car-making.
So from that point of view it would make sense to say, don't worry about the rest of GM too much, you should be willing to sacrifice all of that to increase the changes of making Cruise work.
It's hard to change the culture at a place like GM though. Does the GM CEO really want to take a huge amount of risk? Would they be willing to take a 50-50 shot where they either 10x the company's value or lose it all? Or would they prefer to pay a few billion dollars to avoid that risk.
At the same time, if Musk went away, the stock would crash back to reality but a non-idiot leader could just do impossible, crazy, hard stuff, like ... working on obvious new models and basic steady improvements.
Tesla PE is 398 today (after a drop). Toyota's PE is 13. Toyota at the least is not hemoraging market share, sales, revenue, profits. Tesla is losing on all thoes things. Tesla would need a 30x price reduction to get down to much much more stable and profitable toyota. It's gets worse because Tesla's sales and profit keep going down each quarter.
There's no doubt value in self driving but the overall value is questionable. If there are many companies providing it, and at least waymo is doing great, plus there are many many other companies in China in good shape, the value multiple won't be there.
What's the market value of all taxi compannies combined in the us? It was about $230 billion in 2024 (https://www.skyquestt.com/report/taxi-market). Will tesla get 100% of the us self driving business in the future? No, waymo at least will be a serious market competitor, tesla's service doesn't really work.
Because there are going to be muiltiple competitors with working products (we'll see if/when tesla ever gets there), Tesla's huge valuation will never make sense. Robots are much farther behind than robotaxis (there's no brain, no prototype of a learning system, maybe one day).
This got way too long, I think GM just saw it as a money sink. I think that was a big mistake, though.
That said, you could be right! Maybe self-driving will never be worth more than that. It's really hard to tell what business models will be like in the future. But this is the cultural mismatch, it seemed like GM leadership did not want to be in a risky business where they were betting billions of dollars on the success of self-driving. Clearly, to some people, that seemed like a really good bet to make. Time will tell.
(Also former Cruise employee)
(Another former employee)
(Another former).
Having experience and capability to manufacturer cars has approximately zero benefit to create a self-driving software/sensor stack. It would make more sense for Adobe to create a self-driving car than GM.
Instead they chopped it up for spare parts, specifically, sending some Cruise personnel to work on deadend GM driver assistance tech and firing the rest. Baffling.
Car arrives. I get in. The car is sitting there getting ready to depart but not moving. After a few minutes I hit the button to call support. Someone tells me it's about ready to go. Ten minutes later it starts leaving.
I have no idea why it took so long to start but it wasn't a great experience.
If you (or anyone else from Cruise) can explain what was going on, that would settle the difference in experience to me.
Cruise was always destined to be "like Waymo, but worse". Tesla, on the other hand, is taking a very different path than Waymo, they have a chance at beating Waymo at their own game and even if they don't beat Waymo, they can be a winner in some specific niche. (For the record, I'm a fan of Waymo.)
2. Going directly for vision-only, no geofence system. Waymo's strategy has been to start with a proof-of concept and gradually expand geography and capabilities.
That's how we get Uber, Lyft, DiDi, Grab, Bolt, WeRide, BlackWolf...
He said they were pretty awful and would constantly mess up.
GM pulled the rug on us a day or two before announcing. The current Cruise CEO wasn't aware at all either. I have my own conspiracies of why GM did this, but GM also has a long history of fumbling the ball.
[1] https://www.cbsnews.com/sanfrancisco/news/nhtsa-robotaxi-cru...
[2] https://www.theautopian.com/here-are-five-times-gm-developed...!