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Kyle Vogt exits Cruise, leaving Waymo as the clear robotaxi leader
The departure may have been necessary but it's still a blow for Cruise.
I was not surprised by Kyle Vogt’s resignation on Sunday as CEO of Cruise. To the contrary, I’ve been expecting an announcement like this for weeks, ever since California regulators accused Cruise of failing to disclose that one of its vehicles had dragged a San Francisco woman for about 20 feet after hitting her.
Cruise has been in crisis mode since that news broke. The company halted operations nationwide and brought in multiple external firms to conduct independent reviews. But it was hard to imagine Cruise regaining the trust of regulators in California and elsewhere without a change at the top.
While Vogt’s departure was probably necessary, it’s still a big blow for Cruise. Any time a startup gets acquired by a big company—Cruise was acquired by GM in 2016—there’s a risk that it will get smothered by the bureaucracy of its new parent. Over the last seven years, Vogt has done an impressive job carving out autonomy for his team and maintaining a hard-charging startup culture.
Of course, one of Cruise’s problems was that it was a little too hard-charging. Earlier this year Cruise announced plans to launch in a dozen new markets. Vogt was pushing to reach a billion dollars in revenue in 2025. Those goals now look wildly unrealistic, and pressure to meet them may have contributed to Cruise’s missteps.
At the same time, there’s a risk that Cruise’s new management will become paralyzed with indecision. Something similar happened to Uber’s self-driving car program after one of its vehicles hit and killed a woman in Tempe, Arizona in 2018. Uber suspended operations for several months before resuming testing on a much smaller scale. The project never regained its early momentum and was eventually sold off at a bargain price.
GM lost around $2 billion on Cruise in 2022 and is on track to lose even more this year. Getting GM to fund those losses was already a big ask when Vogt was promising $1 billion in revenue in 2025. Now, with the timeline for commercialization longer and less certain, there’s a danger GM CEO Mary Barra might throw in the towel.
Waymo now stands alone
Waymo has been widely recognized as the leading self-driving company ever since it began as the Google self-driving car project around 2010. But for a while in the late 2010s, Waymo seemed to have a number of serious rivals, including Uber, Lyft, Cruise, Hyundai’s Motional, Ford’s Argo, and startups like Zoox and Aurora.
Some of those projects got shut down, while others are still around. But so far only Waymo and Cruise have launched driverless taxi services on a significant scale. With Cruise suspending operations, Waymo is now the only company operating a significant driverless taxi service in the US.
Waymo launched its service in 2020, which suggests that Waymo is at least two to three years ahead of any of its rivals. If Waymo can perfect its technology, it could have time to establish market dominance.
This is a big opportunity but it’s also a big responsibility. Because if Waymo makes a serious mistake and gets shut down by regulators, that wouldn’t just spell the end for Waymo, it could easily trigger a “self-driving winter” where investors refuse to fund self-driving projects for years to come
That would be tragic because the classic pitch for self-driving technology is still correct: Human drivers kill tens of thousands of Americans every year, and self-driving technology has the potential to prevent many of those deaths.
And despite recent setbacks, I’m still cautiously optimistic that Waymo can pull it off. Preliminary evidence from insurance data suggests that Waymo vehicles crash less often than comparable human-driven vehicles.
Moreover, Waymo’s corporate parent, Alphabet, has much deeper pockets than GM. Alphabet’s corporate structure gives founders Larry Page and Sergey Brin effectively unchecked authority. So as long as those two are committed to Waymo, the company won’t run out of money.
Yes, I know Vogt’s departure is only the weekend’s second most important CEO firing. I plan to work on a piece about Sam Altman’s exit from OpenAI on Monday.