In 2022, the Q2 cruise expenditure reached about $550million, compared with $332million in the same period last year From TechCrunch

The following is the In 2022, the Q2 cruise expenditure reached about $550million, compared with $332million in the same period last year From TechCrunch recommended by recordtrend.com. And this article belongs to the classification: TechCrunch, Automobile industry.

According to techcrunch, cruise, a subsidiary of general motors, is committed to commercializing autonomous vehicle. The company recently launched its first commercial robot taxi service in San Francisco, and its spending increased significantly in the second quarter.

Cruise’s expenditure in the second quarter reached about $550million, compared with $332million in the same quarter last year. The operating loss in the second quarter was as high as $605million, up from $363million last year. Kyle Vogt, CEO of cruise, said that the increase in costs could be attributed to the increase in personnel brought about by the revitalization of Cruise’s robot taxi service, as well as changes in compensation costs.

Cruise has a self described “positive” growth strategy, which Vogt described as “exponential” in GM’s second quarter earnings conference call on Tuesday. In the past, the company has said that the production and rapid expansion of its special origin AVS will be a key part of this growth. However, as General Motors’ profits fell by 40%, the company mainly attributed this to semiconductor shortages and supply chain problems. It is not clear how cruise can avoid these same problems and put “hundreds of thousands” of origins into production next year, as Dan Ammann, former CEO of cruise, promised last October.

Apart from the availability of components and semiconductors, it is understandable that cruise is spending a lot of money in its efforts to expand. Earlier this week, cruise began mapping the streets of Dubai and plans to launch it in 2023. The company recently expanded its automated delivery pilot with Wal Mart in Arizona. Although the company has not yet announced new target cities, one can only assume that a positive growth strategy means that more vehicles will enter more cities next year.

At present, cruise has $1.8 billion in cash, which now seems to be a lot. However, in the first half of 2022 alone, cruise’s operating expenses reached US $868million, and this fund was mainly used to launch robot taxi service with modified Chevrolet bolts in a city.

GM and cruise executives were cautious about providing Cruise’s spending guidance for 2023, but postponed the comments of investors and analysts to the Goldman Sachs meeting in September.

General Motors CEO Mary Barra said on Tuesday’s earnings conference call, “what I want to say is that we will ensure that cruise is funded, and the expenditure is carried out in such a way that we can obtain the share and have a leadership position, and we have a plan. As the technology matures, we will eliminate the cost. Obviously, origin will also be an important part.”

Without the latest guidance, investors will think that with the increase of cars in San Francisco and the launch of new cities, losses may accelerate next year. However, Vogt said that cruise has done the work of “reducing the risk of technical methods” and will apply the effective methods in San Francisco to other similar shared car markets.

Vogt said: “When you have the opportunity to enter a $1trillion market and you can have a highly differentiated technology and products, you won’t think about it at will. You should actively attack it. Given our strong cash situation in cruise, we can do this and actively propose the market. I think this is a competitive advantage. Given our current position, I think the result is self-evident. But now you What we see is early commercialization. “

Cruise’s initial net income in this quarter was $25million, so the expanded loss may be improved to a certain extent due to the increase of future income.

Bala said: “As they demonstrate their ability to charge by car in 30% of the San Francisco area and our plans for this year and next year, we will ensure that we have all the resources to rapidly expand this business, because we do believe that there is a first mover advantage. Therefore, one of the advantages and work that cruise and general motors do together is to ensure that we have a plan and we have available funds to support the rapid growth strategy.”

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