Cruise CEO Kyle Vogt said at an investor conference Thursday that the company is close to getting the green light to begin mass production of its purpose-built autonomous vehicle without a steering wheel or pedals.
“We’re testing it and we’re doing it, from what we’ve heard [the National Highway Traffic Safety Administration]within days of the final regulatory approval, which would allow us to start production and almost immediately start putting these vehicles on the road,” Vogt said at a Goldman Sachs event.
NHTSA told RockedBuzz that no decision has been reached to grant or deny GM’s petition, nor has a deadline been set for such a decision. That said, federal safety regulators are should announce a new regulation in September. If approved, it will also benefit Amazon’s Zoox, which has built and is testing a type of vehicle similar to Cruise’s Origin.
Cruise first unveiled its Origin AV, built for both autonomous ride-hail and delivery, in early 2020. The GM-backed company promised to put “tens of thousands” of Origins on the streets of major U.S. cities in the coming years, but its ability to begin mass production has been hampered by lengthy regulatory processes.
Cruise, via GM, was waiting an exemption by the federal government’s motor vehicle safety standards, which require vehicles to be equipped with a steering wheel and pedals. The NHTSA only grants 2,500 such exemptions each year, but there is legislation to increase that number to 25,000.
The cruise still was testing its Origins in cities where it operates such as San Francisco and Austin.
STAINED! Cruise @Cruise Testing the Origin Shuttle on the streets of San Francisco this morning. Here he is walking away at the Embarcadero traffic light escorted by two small cruise vehicles $GM pic.twitter.com/TCrTviRpmf
— Ed Ludlow (@EdLudlow) September 5, 2023
Vogt’s announcement comes just weeks after one such test vehicle went off the road and crashed into a small electrical building, according to Austin Transportation Department records obtained by Axios. The Origin struck the building with enough force to dislodge some, the report said. Because the vehicle had no steering wheel, emergency personnel were unable to move it quickly and had to wait for a tow truck.
Cruise said the Origin test vehicle had experienced a system failure during testing and had stopped safely, but when live assistance reactivated the vehicle, it left the parking lot and entered the building six miles away. ‘Now.
Much of Cruise’s ability to gain regulatory approval will depend on how the company responds to questions regarding the safety of its vehicles already on the road.
Today, Cruise operates fleets of Chevy Bolt AVs in San Francisco, Austin and Phoenix, with plans to expand to a handful of other cities. The company has come under the microscope in its home city of San Francisco, where it operates about 400 robotaxis, after a series of crashes involving stranded vehicles that caused traffic jams and stranded emergency workers. The California Department of Motor Vehicles asked Cruise to reduce the size of its fleet after one of its vehicles collided with a fire truck, injuring a passenger. This came just days after Cruise, and its competitor Waymo, received final approval to expand fully autonomous commercial services throughout the city 24/7.
Earlier this week, protesters gathered outside Cruise headquarters after firefighters accused the company of allowing its robotaxi to block the path of an ambulance carrying a passenger who later died . Cruise showed footage of the incident to RockedBuzz which supported its denial of the incident as described by firefighters, but the company still suffered a major reputational blow.
Speaking at the investor event, Vogt expressed concern that too much resistance to robotaxis – simply because they are a pioneering technology that will make mistakes – will block important technological advances that could make roads safer and save lives.
“I fear we will set society back a decade when it comes to road safety,” he said. “It’s just something we can’t do.”
Build cheaper AVs for better unit economics
Vogt noted that while the Origin is designed to be “a party on wheels” or a “Zen oasis between meetings or on the way to work,” it will also present the opportunity to build more vehicles at a lower cost .
The Cruise executive and founder said that the Origin costs GM less to build than the Chevy Bolts because all the sensors, processing systems and software are simplified to reduce the initial cost of the vehicle. And in a few years, Origins will rely on Cruise’s custom, in-house designed chips, which Vogt says takes a lot of cost and complexity out of the equation.
“Working closely with GM, we have worked hard to increase the durability of this vehicle,” Vogt said. “The average car has maybe 150,000 miles, 200,000 miles, something in that range. The Origin is designed to last 1 million… and so, when you add long life and lower upfront costs, you get a dramatic reduction in the cost per mile of running these vehicles, which is a key driver of profitability.”
Vogt went on to say that once the Origin goes into production, it can expand very quickly. He declined to provide a timeline or capacity of the GM plant.
“We have a lot of precision on both the final cost and the timing, which means that in 2025, the hardware that we build will be able to reach these unit costs,” Vogt said, reiterating Cruise’s goal of arriving at an operating cost of $1 per mile.
Cruise has stated its goal of reaching $1 billion in revenue by 2025, a goal that Vogt says the company is on track to reach and that could even help Cruise finally break even. That is, if Cruise can start mass producing its cheaper Origin vehicles, expand into new markets, and operate more vehicles at more hours of the day.
This article has been updated with additional information on Cruise’s plans to scale Origin and achieve better unit economics.