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Cruise robotaxis coming to Austin and Phoenix

General Motors' self-driving car subsidiary expects to turn stumbling blocks into stepping stones as it announces ambitious expansion plans.

Cruise plans to offer its driverless car service to passengers in Austin, Texas, and Phoenix, Arizona, by the end of the year. Speaking at the Goldman Sachs conference, Cruise CEO Kyle Vogt said operations would start within the next 90 days and be "revenue generating."

Initially, the service would involve a small number of cars, but he said scaled operations would follow next year. Cruise will partner with Walmart, one of its investors, in Phoenix, where the two companies have already collaborated on a pilot self-driving delivery service.

Cruise also plans to expand its operations in San Francisco, where its commercial, fully driverless rides have been available since June. A fleet of Cruise robotaxis operates in select streets of the city from 10 p.m. to 5:30 a.m. The company has up to 70 cars driving simultaneously and expects to double or triple that number by the end of the year.

Vogt told investors that Cruise hoped to generate $1 billion in sales by 2025, even though it now operates at a loss. He suggested this would be possible as the industry moved away from its current "extreme pessimism" state.

"I think people are going to be caught off guard by how quickly AVs [autonomous vehicles] go from the first ride that you've taken to available pretty much everywhere," Vogt said.

"Calculated bet"

Vogt also addressed safety concerns, saying that the company was "polishing the rough spots" and noting that the product "gets better every day."

A day after receiving a permit to operate its robotaxi service in San Francisco, Cruise had to recall 80 vehicles after one was involved in an incident that ended in minor injuries. Cruise said the problem was resolved after a software update.

At the same conference, General Motors CEO Mary Barra said that the company made a "calculated bet" when it purchased Cruise, a San Francisco-based startup, in 2016.

"[General Motors] is extremely well positioned to lead in this once-in-a-generation transformation," she said, laying out a vision of "zero crashes, zero emissions, and zero congestion."

As it enters Phoenix, Cruise will compete with Waymo, Google's self-driving venture running fully autonomous commercial rides in the city since 2020. Waymo is also present in San Francisco, where it is still testing its robotaxi service.

Baidu, China's answer to Google, has recently become the first company in that country to secure a commercial robotaxi license, with major metropolises of Chongqing and Wuhan first to get the service.

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