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Road to Redemption for GM's Cruise

General Motors' Cruise, the self-driving car unit, faces a lengthy journey to regain public and regulatory trust after a recent safety report commissioned by Cruise highlighted significant issues. GM has slashed about $1 billion from Cruise's annual budget and delayed plans for the unit's return to operations, leaving uncertainty about when its autonomous vehicles will be back on the road. The company faces investigations from various government bodies, including the National Highway Traffic Safety Administration (NHTSA), after an October accident led to the grounding of its U.S. fleet. Cruise appeared to have withheld evidence by both missteps and design, as reported by law firm Quinn Emanuel.

Despite these challenges, GM CEO Mary Barra expressed commitment to Cruise, which incurred a $2.7 billion pretax loss in the previous year. Cruise has laid off a quarter of its staff and grounded its fleet since the October incident. To resume open-road testing, Cruise must navigate regulatory hurdles from agencies such as California's Public Utilities Commission and Department of Motor Vehicles. The company faces probes from the U.S. Justice Department and Securities and Exchange Commission.

Cruise aims to rebuild trust by disclosing more data to regulators and the public. While a Cruise spokesman mentioned the goal of relaunching with supervised driving in one city as soon as possible, internal sources hinted that a return might not occur until the fourth quarter. Cruise has lost its California permit, and discussions about potential relaunch cities, such as Houston and Dallas, are underway. Any relaunch would likely begin cautiously with a small number of cars and no passengers. An engineering analysis commissioned by Cruise revealed failures in the October accident, but GM's Barra maintains that Cruise technology is safer than a human driver. The company is working to retain critical staff for technology development.

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