GM revs up all-electric, driverless answer to ride-hailing services

This article is adapted from GreenBiz’s weekly newsletter, Transport Weekly, running Tuesdays. Subscribe here

The night after my rant about Uber and Lyft’s carbon emissions last week, I got a glimpse of a better way. Inside a warehouse in downtown San Francisco filled with blaring club music, Cruise, the autonomous vehicle division of General Motors, unveiled an all-electric driverless vehicle designed specifically for shared rides.

The “not a car,” Origin, has no engine, no steering wheel, no pedals and tons of space (and legroom) for its passengers. The doors automatically slide open like a minivan’s, which is meant to be convenient for multiple stops in crowded cities and also eliminates the chance of collisions between car doors and bikes or scooters.

Who knows when Origin actually will be commercially driving on our roads — Cruise wouldn’t disclose much about it — but I love the idea of creating a vehicle that tries to solve some environmental negatives that have clouded ride-hailing. The industry should move toward all-electric and do its utmost to optimize pooled rides, which largely have failed to be adopted so far in the United States.

But Cruise’s big reveal was also a big milestone for GM and the auto industry’s thus-far-incremental attempts to move from selling cars to offering cars as a service. While GM and Cruise have long said they’ve planned to launch a ride-hailing service, the arrival of a production-ready vehicle that has been designed to get them there is notable.

“It is not a product you can buy, but an experience you share,” Cruise CEO Dan Ammann emphasized several times at the unveiling, done in front of hundreds of cheering employees and partners and the eye of the (jaded) media. Automakers aren’t yet taking the service business model all that seriously yet, but they should. Automakers are facing a drop in overall car sales as urban drivers opt for new mobility options over vehicle ownership.

GM itself had to shut down five car lines (and the factories that made them) a couple years ago in part because of this trend of consumers’ buying fewer sedans. GM plans to make Origin in a factory in Detroit.

Along with GM, Volvo — the Swedish carmaker owned by Chinese car company Geely — is another automaker that’s embracing cars as a service. At the LA Auto Show in 2018, Volvo showed off a wooden sign that read “This is not a car” in the middle of its expo display, opting to highlight what its customers could experience by “subscribing” to a Volvo car through tech, software and industry partnerships. 

Volvo’s subscription service, Care By Volvo, has turned out to be surprisingly popular, and last year Volvo expanded it into more cities and to include more car models for subscribers. Volvo is a small (and once-declining) automaker that has been resurrected by its Chinese owners. Trying out experiments and seeing what sticks has been part of the turnaround. 

It’s even more impressive that GM, one of the world’s largest and at times conservative, automakers is taking the service model so seriously. 

It’s no doubt that GM and Cruise will face a lot of hurdles getting a ride-hailing service to market. They already have. Last year, the company was forced to push back the launch date from 2019 to an unspecified later date due to the self-driving technology just not being ready yet.

But when the ride-hailing service eventually does come to market, it will be a turning point for automakers and the service business model. The Origin is just the beginning.