Cruise in Crisis: Navigating the Autonomous Vehicle Industry

Founded in 2013 and acquired by General Motors (GM) in 2016, Cruise was a trailblazer in the autonomous vehicle industry. Cruise had rapidly expanded under the guidance of GM, but this growth was marred by crashes and disruptive interactions with emergency vehicles. By November 2023, the company had become the focus of intense public and regulatory scrutiny following a serious incident in San Francisco, California, on October 2, when a Cruise robotaxi caused severe injuries to a pedestrian. In the aftermath of the incident, Cruise faced significant backlash from regulators and consumers. The California Department of Motor Vehicles suspended the company’s operational permits, and Cruise temporarily halted its driverless operations, shifting to vehicles operated with safety drivers. The co-founders resigned, and Cruise appointed a new president and chief technology officer. What actions should the new president take to prevent such an incident from happening again, regain the public’s trust, and ensure rigorous safety standards and transparent communication? The decisions the company made in the coming months would be crucial in shaping its future trajectory.

This case study is suitable at the undergraduate and graduate level for courses addressing the risks involved in operating a technology-focused business, and for courses related to leadership and crisis management. Analyzing this case will give students the opportunity to do the following:<ul><li>Identify and evaluate the strategic decisions that contributed to Cruise’s failure.</li><li>Assess the incident from the viewpoints of various stakeholders, including the government, regulators, consumers, and Cruise.</li><li>Develop strategies for effective crisis management that can help Cruise navigate future challenges while strengthening a sustainable competitive advantage.</li></ul>

• Cruise
• autonomous vehicle
• challenges
• regulations