On the global autopilot track, the new car-making forces led by Tesla have always been considered by the general public to be the more radical side, largely thanks to the "black technology" they pull out from time to time. On the other hand, the traditional car companies that once dominated the automobile market are regarded as a model of eating the ancient because of the slow transformation.
However, this is not the case, whether it is Mercedes-Benz, BMW or General Motors, their exploration of self-driving technology is methodically proceeding. According to Mercedes-Benz's planning, its two flagship sedans, S-Class and EQS, will be the first to be equipped with L3-level autonomous driving technology, and will soon be legally used in the German market; GM, its self-driving subsidiary Cruise has also been rapidly expanding its business, and recently cooperated with domestic autonomous driving startup Momenta, intending to accelerate the landing of technology.
Of course, the exploration of technology is always inevitable setbacks, even if it is a traditional car company with strong financial strength, it is inevitable that it will hit a wall in how to retain talents. Recently, General Motors has encountered such a troublesome matter.
Image from Yandex
Veterans leave, general silence
According to GM's recent announcement, Daniel Ammann, CEO of its self-driving subsidiary Cruise, is preparing to leave, and after he leaves, Cruise co-founder and CTO Kyle Vogt will temporarily take his place as interim CEO.
Oman is one of GM's veterans. As early as 2009, he took over the bankruptcy restructuring of General Motors as the head of Morgan Stanley Industrial Investment Banking, and has been associated with the company ever since. After GM's restructuring was completed in 2012, he joined the company as treasurer and soon after continued to serve as CFO and executive vice president. In 2014, Oman was promoted to president of General Motors, in charge of Chevrolet, Cadillac and other businesses.
In 2016, Oman, as president of General Motors, was deeply involved in GM's acquisition of Cruise, and subsequently took over the leadership of this new business. Oman, one of the promoters of the acquisition, was clearly intrigued by the new business, as he handed over leadership of the Cadillac brand to one of his colleagues, Mark L. Reuss, shortly after the acquisition was completed, and focused on chevrolet and Cruise.
Cruise, under Oman's leadership, was once extremely vocal. In 2020, Cruise's first self-driving model, Origin, was completed under his leadership, and he also acquired another self-driving startup, Voyage, for Cruise. Earlier this year, Cruise released news that its self-driving car scale will expand to 1 million in 2030.
Origin, Oman's first self-driving model with Cruise, image from Yandex
In addition, Oman has also successfully attracted a lot of financing for Cruise, and its shareholders include honda, softbank and other well-known companies. After the introduction of a lot of capital, the company's valuation has reached $19 billion (about 121 billion yuan).
It is precisely because of Oman's achievements over the years that his departure at the speed of light is intriguing, and GM's ambiguous attitude makes the incident even more confusing - in the announcement, GM did not name why Oman left, but only vaguely stated that he was "looking for other opportunities", in addition, Cruise's spokesperson did not respond positively to the media.
While GM didn't give an answer, that doesn't stop the industry from widespread speculation. Citi analyst Itay Michaeli said in a note on Friday that Oman had its own plans for when Cruise launched its independent IPO, which led to disagreements with GM; others attributed his departure to "disappointment with the business", arguing that Cruise's delay in commercialization led him to leave the company.
In any case, the veteran, who has been fighting for many years for GM and Cruise, eventually left his seat, and GM had to face a fiercely competitive and difficult second-half of autonomous driving. Whether Cruise can complete GM's self-driving ambitions without Oman is still worth our continuous observation.
Although autonomous driving is a dangerous road, GM has to go
In the field of new energy vehicles, GM has always had the status of "forerunner". In 1996, it launched its first pure electric vehicle EV1, and at that time the market was still the world of fuel vehicles. After 25 years, GM still has not left behind the technology research and development, and its Ultium electric platform and Hydrotec fuel cell system are worthy of its pride.
Universal Ultium platform, image from Yandex
Embarrassingly, despite GM's achievements in battery technology, it has struggled to make a Mass-class product that will make it soar. For now, the only one that can afford this title is its Chevrolet Bolt — two models in the series sold more than 20,000 units in the second quarter of this year, barely on par with The Tesla Model 3. But it is such a product, not long ago, there was also a large-scale battery pack fire in the US market, which directly led to an emergency shutdown of GM for 20 days.
The outbreak of such a vicious event will undoubtedly cause GM to greatly hit the prestige established by GM in the field of batteries. In this case, if GM also wants to complete its plan to "launch 20 electric vehicles by 2023 and sell 1 million electric vehicles per year in China", in addition to in-depth optimization of batteries, it is of course necessary to exert self-driving systems - once this technology is successfully landed, it can enhance the competitiveness of its models beyond batteries and prices.
As mentioned earlier, Cruise has been exploring autonomous driving solutions on behalf of GM, not only reaching an agreement with Honda to enter Japan to carry out autonomous driving mobility services, but also signing a strategic alliance with Microsoft to promote the commercialization of autonomous driving. With the acquisition of Voyage, Cruise took over all of its technology and 60 employees, further growing.
It is not difficult to see that GM has accumulated enough experience on the road of autonomous driving for many years, and it also has the strength and determination to promote the real maturity and landing of this technology, and the Chinese automobile market that has sprung up in the electrification process has naturally become the preferred automatic driving landing target of GM.
In September, GM invested $300 million in domestic self-driving startup Momenta, and according to Julian Blissett, GM's executive vice president and president of China, the agreement with Momenta "will support GM to accelerate the next-generation solution tailored to Chinese consumers and put it into use."
Image from Momenta's website
Of course, even if GM Cruise cooperates with Momenta, they still have to stand the test of consumers in the domestic market, and there are never many self-driving startups and car companies that share the same ideas. As an example, Wenyuan Zhixing has completed B and C rounds of financing in the past year, and investors include Renault-Nissan-Mitsubishi Alliance Fund and Yutong Group; Xiaoma Zhixing and Tucson Future two start-ups received investment from traditional car companies such as Toyota, FAW and Volkswagen last year.
In addition, the domestic standards for automatic driving classification are becoming more and more stringent, after the State Administration for Market Regulation and the State Standardization Administration jointly issued the "Automobile Driving Automation Classification" recommended standards, re-dividing automatic driving into L0-L5 levels. It is conceivable that the future tests that GM and Momenta will face will only become more severe.
Will an IPO "breakup" be the best option for GM and Cruise?
While GM is worried about the landing of technology, the wind direction of the global autonomous driving industry has quietly changed - the autonomous driving start-ups that used to be keen to talk about cooperation and road testing have now started to make a plan to go public.
In November, self-driving startup Aurora announced that it had completed its merger with shell company Reinvent Technology Partners Y, officially completing its listing on nasdaq in the form of SPAC, under the ticker symbol AUR. There is no doubt that its listing has symbolic significance in the US stock market - Aurora is currently the world's most valuable unmanned car startup, and the first platform-based autonomous driving company to achieve an IPO, and the founder of the company is the former head of Google's self-driving project.
Prior to its listing, Aurora had received information from Baillie Gifford, Counterpoint Global, T. Institutions such as Rowe Price Associates raised more than $1 billion and received strategic investments from Uber, PACCAR and Volvo Group.
Aurora co-founder and CEO Chris Urmson revealed the purpose of the SPAC listing. He believes that this listing will bring sufficient funds for the company's subsequent development.
Aurora isn't the only self-driving startup to hit the capital markets, as is Mobileye, which was acquired by Intel. On December 6, Intel announced that it would promote Mobileye's listing in the United States in mid-2022 through an IPO, and it also announced that the plan had received full support from the board of directors.
Unlike Aurora, which went public in search of growth, Intel pushed Mobileye to the market more for cash-out. When it was acquired by Intel that year, Mobileye's pre-privatization market value was $13.92 billion, while intel gave a valuation of more than $50 billion. Coupled with the capital market's optimism about the concept of autonomous driving stocks, once Mobileye successfully goes public at this valuation in the future, Intel is expected to reap extremely rich returns from it.
Of course, it may also be a good thing that Mobileye is split separately, for it, it is not good to be deeply tied to Intel's various semiconductor businesses with uncertain development prospects, but it will make it constrained everywhere.
At present, car companies have a huge demand for chips and self-driving chips (which is the strength of Intel and Mobileye, respectively), but they also increasingly dislike these lifelines being grasped by a company. After Mobileye is split, it can not only provide services for major car companies from a neutral stance, but also draw nutrients from the capital market for future development. Obviously, this is much better than sending people under the fence, living in a foggy night, and probably worrying about the risk of the business being cut.
On the side of General Motors and Cruise, why is this not the case?
As a member of the automotive industry, GM is bound to face off against many traditional auto companies and new forces, and Cruise's development prospects will be blocked by them - if car companies do not even like to give the lifeblood to a company that has no competition with themselves (referring to Intel), then how can they install competitors' self-driving solutions on the car? Perhaps Oman and General Motors have "diverged over the Cruise IPO," as analyst Mitchell put it, but for the two companies, letting go of each other early may be their best bet.