Cruise, BrightDrop, and Middle-Mile Deliveries

In the last decade, General Motors has invested heavily in a variety of startup businesses, some of which were created outside of the automaker and some within. These have included the Maven car-sharing business, BrightDrop for electric commercial vehicles, and Cruise for automated driving. To say that none of these have become world-conquering success stories would be an understatement. But that doesn’t mean there aren’t still opportunities in at least some of these efforts. 

Struggling Startups

In 2016, General Motors acquired a small San Francisco-based startup called Cruise that was developing a Level 4 automated driving system (ADS). In the SAE J3016 standard for assisted and automated driving taxonomy, L4 means the vehicle is capable of driving itself without human supervision or intervention in a defined operational design domain (ODD). In English, that means you can tell the vehicle where to go, and it does it as long as it’s within constraints, such as location, weather, time of day, or any other limitation. 

Cruise ultimately became the core team for ADS development within GM and eventually focused on developing commercial robotaxis. By 2022, it became the second company in the U.S. after Waymo to launch a commercial, driverless robotaxi service. By spring 2024, it had been effectively shuttered. 

2016 also saw the launch of Maven, a car-sharing service similar to Zipcar that placed fleets of GM vehicles into cities that could be rented by the hour or day. Like Zipcar and most other services, Maven never really found an operational model with a path to profitability, although at one time, many considered that it would be a platform for deploying Cruise robotaxis. Needless to say, that never happened, and Maven was shut down in April 2020.

This image of a middle-mile BrightDrop van was generated using AI.

In 2021, a team within GM launched a startup called BrightDrop. BrightDrop would produce and sell battery-electric commercial vehicles based on GM’s then-new Ultium EV component set. While BrightDrop has launched two versions of its Zevo cargo van, sales have been modest, and the new business floundered. Eventually, the BrightDrop vehicles were folded back into the Chevrolet Fleet business.

A Path Forward

However, just because these individual businesses haven’t succeeded doesn’t mean all the work has to go to waste. Cruise’s on-road testing and deployment were paused in October 2023 following an accident where a pedestrian was struck and then dragged under a Cruise vehicle operating in automated mode. Following an investigation, most of the Cruise senior management team was fired. After further study, GM and the division’s new management concluded that even when the technology was sufficiently mature, the robotaxi business was unlikely to be profitable before at least the 2030s. 

The challenge for robotaxis is that even though the human driver is removed from the ride-hailing ecosystem, the business still requires a lot of staff for vehicle maintenance and cleaning, as well as customer support. Demand for ride-hailing services is also very uneven during the course of the day, leaving vehicles underutilized. While there have been hopes to use the vehicles for last-mile delivery when passenger ride demand is low, this also has significant challenges. Ultimately, GM decided to shut down Cruise and bring many of its engineers in-house to work on driving automation for future consumer vehicles. 

The Last 10-Meter Problem

Over the past decade and in particular since the COVID-19 pandemic, last-mile deliveries have grown enormously in popularity. Amazon delivery trucks roll through suburban neighborhoods often multiple times per day. Just as with ride-hailing, there has been a lot of interest in combining ADS with last-mile deliveries, particularly during periods when ride demand is weak. But while ADS can help with the last mile, it runs into a major blockage in the last 10 meters. 

When the Amazon, UPS, or FedEx truck rolls up with a package, unless it explicitly needs a signature, the driver gets out, walks up to the customer’s porch or garage door, puts down the package, takes a photo for proof of delivery, and then gets back in the truck to repeat the process upwards of 150 times per day. If no one is home, it doesn’t really matter; the package still gets delivered. 

Remove the driver, and you have now created the last 10-meter problem. How does the package get from the truck to the porch? If someone is ordering a meal from a local restaurant, they are usually there to receive it, so a small sidewalk delivery bot can roll up, and the customer takes out their food. But packages coming in the middle of the day are often unworkable. 

Cruising The Middle-Mile

An alternate business model for combining ADS and deliveries is what’s known as the middle-mile. In this application, routes are typically between distribution centers and retail storefronts or between various businesses. For example, the popularity of curbside pickup for online grocery orders during the pandemic led Walmart to establish micro-distribution centers in various cities. Rather than having staff walking the aisles of a retail store to collect items for an order, micro-distribution centers can be arranged for more efficient pick and pack operations and even be automated. 

Each warehouse can serve multiple retail stores where customers can pull up to collect orders curbside. Using automated box trucks to deliver the packaged orders from the warehouse to the stores is much more efficient than random pickups and deliveries. Routes can be optimized for efficiency and safety. Most importantly, there are always staff at each end of the trip to load and unload the orders from the truck. San Jose-based Gatik is currently leading this use case in partnership with Isuzu. 

All of this brings us back to Cruise and BrightDrop. The larger Zevo 600 BrightDrop vans or even the smaller Zevo 400 are well-suited to middle-mile operations, and the electric propulsion makes them very efficient and clean. At the time that Cruise shut down, there were still a number of technical challenges with routing and general operation. Reducing the ODD to more constrained and well-defined routes significantly lowers the risk profile. Combine the Cruise ADS with these vans, and you have a nearly ideal vehicle for the use case. 

The modified Chevrolet Bolts that Cruise was using for its development and robotaxi operations are again appearing on public roads for testing. I saw one on a local highway a few weeks ago. Gatik is using internal-combustion engine Isuzu box trucks. It’s a nascent market, and it’s probably only a matter of time before we see Rivian vans equipped with the Zoox ADS, which Amazon also owns. GM should seriously consider utilizing the Cruise-BrightDrop combination for middle-mile deliveries. GM could finally get some return on its investment in Cruise and BrightDrop.