GM’s Cruise, AV Industry Under Scrutiny In California As Driverless Vehicle Reps Attend Hearing

With its fleet of robotaxis currently parked following an accident with a pedestrian in October, can Cruise, the autonomous vehicle (AV) operator, recover the reputational damage the incident has caused — not just for the GM (NYSE:GM)-owned company, but for all operators of AVs?

This is what GM is concerned with ahead of a Tuesday hearing held by state regulators regarding the company’s failure to disclose details of the October incident.

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According to Reuters, the California Public Utilities Commission is holding the hearing as part of an investigation into GM’s failure to disclose details of an accident involving a self-driving car.

On Oct. 2, a Cruise AV hit a pedestrian who was thrown into its path by another vehicle. The AV then executed a pull-over maneuver that dragged the pedestrian 20 feet at 7mph.

The CPUC contends that when a Cruise official reported the incident to the commission, they omitted the details of the pull-over maneuver that caused significant injuries to the pedestrian.

While Cruise has offered to pay $75,000 to resolve the CPUC investigation and has fired a number of executives in the aftermath of the incident, its entire fleet — which operated in San Francisco, Phoenix and Austin — was suspended by the company, which has since cut 24% of its workforce.

Safety Incidents Reported

The future of the AV market darkened further after San Francisco attorney David Chiu filed a lawsuit in December against the state of California, alleging that the CPUC allowed companies — including Cruise and Alphabet’s (NASDAQ:GOOGL) Waymo — to expand despite safety issues.

First reported by the Washington Post last week, the lawsuit asked the CPUC to review whether its decision to allow Waymo to operate its robotaxi service in the city was compliant with the law.

The lawsuit contends that, despite hundreds of serious safety incidents reported by the public and city officials, “the commission approved requests by Cruise and Waymo to operate.”

Companies Dial Back On AV Plans

Meanwhile, several companies have cut or abandoned their research into self-driving vehicles. A year ago, Ford (NYSE:F) and Volkswagen (OTC:VWAGY) announced the end of their AV joint venture following the closure…