GM's Cruise robotaxi service targeted in Justice Department inquiry into San Francisco collision

FILE - Associated Press reporter Michael Liedtke sits in the back of a Cruise driverless taxi that picked him up in San Francisco's Mission District, Feb. 15, 2023. General Motors is facing a U.S. Justice Department investigation into a gruesome collision involving a robotaxi operated by GM's Cruise subsidiary that critically injured a pedestrian and derailed its self-driving car ambitions, potentially worsening an already severe backlash. (AP Photo/Terry Chea, File) (Terry Chea, Copyright 2023 The Associated Press. All rights reserved.)

SAN FRANCISCO – General Motors is facing a U.S. Justice Department investigation into a gruesome collision that critically injured a pedestrian and derailed its self-driving car ambitions.

The Justice Department inquiry disclosed in a report Thursday is the latest twist in a debacle that began in October after a robotaxi operated by GM's Cruise subsidiary dragged a pedestrian about 20 feet (6 meters) after the person was struck in San Francisco by another vehicle driven by a human.

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The incident resulted in Cruise's license to operate its driverless fleet in California being suspended by regulators and triggered a purge of its leadership — in addition to layoffs that jettisoned about a quarter of its workforce — as GM curtailed its once-lofty ambitions in self-driving technology. Cruise's omission of key details about what happened in the Oct. 2 incident also led to allegations of a coverup that could result in a fine of $1.5 million. Cruise has offered to pay $75,000 instead.

GM didn't release any details about the nature of the Justice Department's investigation, or of another one by the U.S. Securities and Exchange Commission. A company spokesman would only say GM is cooperating with authorities.

The revelations about the latest troubles facing Detroit-based GM and San Francisco-based Cruise came in a report reviewing how things were handled after the pedestrian was hurt.

The report prepared by the law firm of Quinn Emanuel Urquhart & Sullivan rebuked Cruise's management that has since been dumped for ā€œpoor leadership, mistakes in judgment, lack of coordination, an ā€˜us versus them’ mentality with regulators.ā€ But the report also asserted that Cruise initially thought it had shown California regulators a video that included segments showing a robotaxi named ā€œPaniniā€ dragging the pedestrian, only to discover later that scene hadn't been seen because of internet streaming issues.

The report blamed Cruise for having a ā€œmyopic focusā€ on protecting its reputation instead of setting the record straight after management realized regulators hadn't seen the video of the incident in its entirety.

ā€œCruise must take decisive steps to address these issues in order to restore trust and credibility,ā€ according to the report's summary findings.

GM has already installed a new management team at Cruise and walked back its goals for a driverless division that was supposed to transform the transportation industry by operating robotic ride-hailing services across the U.S. Even as skeptics raised doubts about whether autonomous driving technology had become reliable enough to realize that vision, GM was projecting Cruise would generate $1 billion in revenue by 2025 — 10 times the amount it had been bringing in during a ramp-up phase that resulted in billions of dollars in losses.

Cruise had cleared a significant hurdle last August when California regulators approved its request to begin operating its robotaxi service throughout San Francisco at all hours — over the strenuous objections of city officials — only to have it all unravel in early October.


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