General Motors has disclosed that its autonomous vehicle division, Cruise, is under scrutiny by both the Department of Justice and the Securities and Exchange Commission due to an incident in October involving one of the company's self-driving taxis.
This inquiry stems from an event on October 2, where a woman was initially struck by a human-operated vehicle and subsequently pulled for approximately 20 feet by Cruise's autonomous taxi, resulting in severe injuries.
Post-incident, officials from Cruise attempted to relay the event details to regulatory authorities using a video. However, the video was unclear because of certain technical difficulties. The Cruise team also failed to provide a verbal account of the event to authorities.
According to a blog post by GM, a legal evaluation conducted by the law firm Quinn Emanuel unveiled no proof that Cruise executives or employees deliberately misinformed or concealed information from regulators.
A separate engineering report by Exponent discovered that the Cruise vehicle classified the impact with the woman as a side-collision. Following this incident, Cruise made updates to its software.
The evaluations confirmed that Cruise mishandled the event due to inadequate internal processes, misjudgments, a confrontational attitude towards government officials, and a fundamental misunderstanding of regulatory requirements and expectations.
Despite this, Cruise claimed in the blog post that its response could be interpreted as a new company inexperienced in working with the media, regulators, and the general public making mistakes.
In December, authorities in California suggested that Cruise's inadequate disclosure of the incident to regulatory bodies could lead to a steep fine of $1.5 million, along with other penalties. Moreover, Cruise's authorization to operate self-driving cars was revoked in October.
The incident led to the resignation of Cruise's CEO and a co-founder, followed by the dismissal of nine executives and a 25% reduction in staff.
On February 6, Cruise representatives will sit down with regulators to discuss the incident report in detail and agree on a suitable fine. Cruise had previously proposed a $75,000 settlement.
