General Motors recently posted its Q1 2020 financial results, surprising analysts and Wall Street with $300 million in income on $32.7 billion in revenue. GM was the only one of the big three U.S. automakers to post a profit. During the recent first-quarter 2020 earnings call, GM CEO Mary Barra addressed a number of crucial topics, including an indication that the automaker’s highly profitable full-size SUVs were on-track for shipping in June, and that the company’s future EVs were on track despite disruptions from the COVID-19 pandemic. What’s more Barra said she was “very pleased” with the progress made by the GM Cruise autonomous vehicle division.
During a Q&A session, Bank of America-Merrill Lynch analyst John Murphy asked Barra if she was rethinking the dollar commitment required to develop the GM Cruise autonomous vehicle technology, citing a $1 billion annual investment without any associated revenue.
Barra backed the company’s commitment to AVs, saying: “Well, first, I’m very pleased with the progress that we’re making from a technology perspective at Cruise. Just reviewed that earlier this week. So I think that we are continuing to hit milestone after milestone there.”
Barra did not elaborate on exactly what those milestones were. However, in response to a question proposed by Murphy with regard to integrating GM Cruise technology into the existing GM product portfolio, Barra talked about the GM Super Cruise semi-autonomous driver assist feature, saying:
“As it relates to bringing the technology into our fleet of vehicles on the road today, that’s really occurring through Super Cruise and we continue to add miles, add roads, add features, and you’ll see us as we spread it across the portfolio, starting with Cadillac and then moving to others.”
As was announced last June, the Super Cruise semi-autonomous driver system gained an additional 70,000 miles of usable highway driving last year, bringing the grand total to 200,000 miles of divided highway driving throughout the U.S. and Canada for customers. The GM Cruise-derived technology will see widespread implementation throughout the Cadillac lineup, including with the all-new 2021 Cadillac Escalade, while availability is expected to expand to 22 vehicles total by 2023, and will include non-Cadillac vehicles as well.
Meanwhile, the Cruise Origin driverless taxi was unveiled back in January.
John Murphy – Bank of America-Merrill Lynch – Analyst
“Okay. And then just a second question, I mean the commitment to Cruise, seems like it’s unwavering. But there is about $1 billion a year going out the door without any revenue. I’m just curious if you’re rethinking that dollar commitment on an annual basis, the potential business and monetization of it. And one phrase that I think you mentioned superhuman driving experience sounds really appealing to me. Is there the potential that you could lead some of this technology into your existing product portfolio over the next few years if you don’t see the monetization of an AMoD fleet anytime in the near future?”
Mary T. Barra – GM Chairman and Chief Executive Officer
“Well, first, I’m very pleased with the progress that they’re making from a technology perspective at Cruise. Just reviewed that earlier this week. So I think that we are continuing to hit milestone after milestone there. So I’m very positive about what’s happening at Cruise from that perspective. So I see huge opportunity. And so our commitment, as you said, is unwavering.
“As it relates to bringing the technology into the — our fleet of vehicles on the road today, that’s really occurring through Super Cruise and we continue to add miles, add roads, add features and you’ll see us as well as spread it across the portfolio, starting with Cadillac and then moving to others. So definitely have an aggressive plan to further roll out and improve the capability of Super Cruise.”