Jan 22, 2020

Cruise says new self-driving van will save passengers $5,000 a year

Cruise Origin, a driverless EV that Cruise plans to use for ride-sharing. (Photo: courtesy of Cruise)

Cruise unveiled a six-passenger, electric, driverless vehicle in San Francisco Tuesday night, heralding it as the start of a new era of low-cost, shared transportation that will save the average household $5,000 a year.

Why it matters: With no steering wheel, pedals or gasoline engine, the boxy Cruise Origin, co-developed with Honda, represents "the transportation system you’d build, if you could start from scratch," according to Cruise CEO Dan Ammann, a former president of General Motors.

Yes, but: It's not clear how Cruise — which scrubbed plans to launch a robo-taxi service in San Fransisco in 2019 — would turn that vision into reality, much less a viable business.

  • Pressed for details later, Ammann said Cruise would scale up a ride-sharing business by offering "a better experience at a lower price than what you pay to get around today."
  • A typical Uber or Lyft ride costs about $2 per mile, he said, while a personally owned vehicle costs about $1 per mile. Cruise's goal is to offer shared rides that are even cheaper, causing people to gravitate toward its service to save as much as $5,000 a year.

The math is a bit sketchy and based on some unproven assumptions, but there are some intriguing nuggets:

  • Unlike most cars, which sit idle 95% of the day, the Origin would operate 24/7 and last for 1 million or more miles — about six times longer than a typical car.
  • It's based on General Motors' newest electric vehicle platform — the basis for 20 upcoming EVs by 2023 — which will help reduce costs, Ammann said.
  • "Since GM has committed to producing millions of electric vehicles, we’ll build it for roughly half the cost of what a conventional electric SUV costs today," he said, showing a photo of a Tesla Model X, which starts at $81,000.
  • GM, Cruise's majority shareholder, will build the Origin, but where and when production begins has yet to be announced.

Cruise shared some technology advancements as well.

  • The Origin features a new multi-layered sensor suite that is designed to keep track of multiple people and objects — even if they’re far away, in pitch-black, or hidden by rain or fog.
  • The pair of front-mounted sensor units, combining cameras, radar, lidar and thermal imaging technology, swivel like an owl's head to keep an eye on the environment, complementing other sensors mounted around the vehicle.
  • Cruise has been testing automated Chevrolet Bolt EVs in San Francisco for several years and is now close to matching human driving capability, said co-founder and president Kyle Vogt.
  • With its new sensors, he said, Cruise is "on track to crack the 'superhuman' threshold" soon and will be "well past that threshold by the time the Cruise Origin enters production."

What to watch: Aside from the substantial commercial and technical challenges that lie ahead, there are regulatory hurdles as well.

  • The Origin does not comply with current federal motor vehicle safety standards, which assume a human driver and thus require a steering wheel, foot pedals, mirrors and other features.
  • Ammann said the company is in discussions with the National Highway Traffic Safety Administration about a waiver.
  • And, while Cruise has a permit to test its autonomous vehicles on public roads in California, it does not have a license to charge people for rides in self-driving cars.

Go deeper: The autonomous vehicle cash grab

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GM is eating Tesla's exhaust

Tesla Model 3. Photo: Smith Collection/Gado/Getty Images

While Tesla shares went into Ludicrous Mode this week, GM executives were on Wall Street pitching investors on their own vision of an electric, self-driving future. But as Bloomberg notes, the market isn't buying.

Why it matters: GM may be investing billions to transform its business for the future, but to many investors, Tesla's lead in the fledgling electric vehicle market is seen as insurmountable.

GM to invest $2.2 billion to revamp Detroit plant for electric production

GM CEO Mary Barra. Photo: Bill Pugliano/Getty Images

GM will detail plans Monday to invest $2.2 billion to retool its Detroit-Hamtramck plant for production of electric and autonomous vehicles, per multiple reports.

Driving the news: The vehicles include the Cruise Origin, which is the 6-passenger, driverless electric van unveiled last week.

Go deeperArrowJan 27, 2020

Feds clear the way for Nuro's driverless deliveries

Nuro's second-generation delivery vehicle, R2. Photo courtesy of Nuro

The U.S. Transportation Department is giving its regulatory blessing to the first autonomous vehicle with no steering wheel, pedals or human occupant.

Why it matters: Vehicle safety standards were written for today's cars and trucks, mostly to protect humans riding inside them. By granting an exemption to Nuro's self-driving delivery vans, the National Highway Traffic Safety Administration is beginning to pave the way for the driverless era.