General Motors (NYSE:GM), Honda (NYSE:HMC), and Cruise have announced plans to launch a driverless ride service in Japan by 2026. The service, which will be available via a smartphone app, will initially operate within central Tokyo with a small fleet of vehicles. The company aims to expand its fleet to 500 vehicles in the future.
The joint venture between these three companies is expected to be established in 2024 to manage the service. Expansion beyond Tokyo is contingent on customer satisfaction, according to Honda CEO Toshihiro Mibe.
Despite the industry-wide trend of reducing investment in autonomous technology, GM remains committed to this project because of the safety benefits it offers, as stated by GM CEO Mary Barra. However, Cruise, a self-driving car company backed by GM, is currently under scrutiny by U.S. federal regulators due to reports of its autonomous vehicles exhibiting risky behavior toward pedestrians.
While facing challenges such as the delay in opening an electric vehicle (EV) truck plant in Michigan, a strike by the United Auto Workers (UAW), and weakening EV demand, GM's stock has underperformed this year. Nevertheless, analysts predict a potential 64.62% increase for GM's stock despite these obstacles. The stock has received various recommendations including eight Buys, five Holds, and two Sells with an average price target suggesting an upside of $48.53.
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