SF Standard – Cruise Hired a Lobbyist Close to Newsom. Then a Crash Changed Everything
See full original article in the SF Standard by Josh Koehn.
Editorial note: this article is key because it explains how not only did Cruise and Waymo report spending $2.3m to lobby state and local politicians to allow them to use our roads as a testing ground, but Cruise did not report hiring the lobbying firm Axiom Advisors, close partners with Governor Newsom, until after the filing deadline and after the key August CPUC hearings. Governor Newsom of course appoints and fully controls the CPUC board.
Cruise may go down as the Icarus of autonomous vehicles, as the company’s ambitious rollout of robotaxis in San Francisco drove too close to the sun and left many badly burned.
The fallout of an Oct. 2 crash involving a Cruise robotaxi in San Francisco—where a woman suffered “traumatic injuries” after being struck by a car, then dragged by a Cruise vehicle—has been swift and severe.
Three months ago, Cruise was one of two autonomous vehicle companies granted unfettered access to San Francisco streets. But in the weeks following the Oct. 2 crash, Cruise had its permits revoked and recalled all of its vehicles, and top executives have started showing themselves the door.
Kyle Vogt, the co-founder and CEO of Cruise, announced he was stepping down Sunday, and co-founder Dan Kan resigned on Monday. Just in July, Vogt was talking about Cruise taking the wheel in a “multitrillion-dollar” market. Now, the fate of the autonomous vehicle company—purchased by General Motors in 2016 and once slated to bring in a billion dollars in revenue by 2025—has never been less certain.
Many are wondering how Cruise was able to expand so fast and furiously. The most obvious answer appears to be money and connections, but the role of one deeply connected lobbyist has not been fully known until now.
A Lobbyist With Ties to Newsom
In August, The Standard reported that Cruise and its main competitor Waymo, which is owned by Google parent company Alphabet, spent more than $2.3 million combined since 2021 to lobby local and state officials for unfettered access to San Francisco’s roadways.
Both companies were seen as aggressive actors, but Cruise was particularly so. However, it appears not all of Cruise’s lobbying activity was being reported.
On the same day The Standard published its report on autonomous vehicle lobbying, Cruise filed forms with the Secretary of State’s Office, noting that it had been employing Axiom Advisors since April 1. The firm, which has been paid at least $76,000, was co-founded by Jason Kinney, the man behind Gov. Gavin Newsom’s infamous French Laundry dinner, which led to a $200 million gubernatorial recall election in 2021.
It seems these filings for Cruise and Axiom were made well past the state’s deadlines on lobbying disclosures, blocking the public from having a transparent accounting of influence-peddling in Sacramento. A spokesperson for the state’s Fair Political Practices Commission declined to comment on issues raised about Cruise’s lobbying.
In an email, a Cruise spokesperson told The Standard that Kinney’s firm has been working with the company in an advisory role since January.
Neither Kinney nor Newsom’s office responded to requests for comment by press time, but the two have been closely linked for decades. And in the years since the French Laundry dinner, both Kinney and Newsom have seen money come rolling in.
While there is no indication that the two men discussed Cruise, Newsom has frequently touted the potential for autonomous vehicles to have a transformative effect.
“The only reason Cruise got approval [to roll out robotaxis in San Francisco] was because they did a heavy lobbying push to politicians,” said David Latterman, a longtime political analyst in San Francisco. “Here’s just another example of a company working to subvert commonsense public safety stuff. But that’s what lobbyists do. It’s like, ‘Don’t hate the player, hate the game.’”
Multiple sources with knowledge of Cruise’s gameplan told The Standard that Kinney was instrumental in leading Cruise’s strategy to influence lawmakers and eventually get approval from the Department of Motor Vehicles and the California Public Utilities Commission to operate robotaxis at all hours of the day in San Francisco. His close ties to Newsom were also seen as key.
“[Kinney] was Gavin’s golden guy for fundraising,” said a source with knowledge of Cruise’s operations. “Everyone knows that. Gavin doesn’t show up at the French Laundry just because you invite him.”
During a trip to China last month, Newsom said he supported the DMV’s decision to suspend Cruise’s operations in California, but in September, he sided with autonomous vehicle companies when he vetoed a bill sponsored by the Teamsters to require humans in autonomous trucks.
“If it wasn’t for Jason, I don’t think Gavin would have been this bullish for Cruise,” the source said. “Obviously, when it comes to China, he said what he said. He had no choice at that time, because someone got injured. But he went against the Teamsters. How can you go against labor when you’re going to run for president?”
Peter Finn, vice president of the Teamsters Western Region, suggested that Newsom’s veto reflected campaign money he had received. Records with the Secretary of State’s Office show that Cruise gave $52,400 to support Newsom’s reelection as governor in 2022.
“Unfortunately, politicians side with big corporations over people, usually for one reason—and that’s for campaign contributions,” Finn said.
He added, “This culture of ‘move fast and break things,’ when you’re developing Yelp, that’s one thing. When you’re deploying driverless vehicles around families and kids and pets, it’s wholly irresponsible.”
Who Will Win the Robotaxi Race?
Few could have predicted the collapse of Cruise’s operations during an Oct. 24 earnings call held just hours before the DMV suspended the company’s permits across the state.
GM reported confidence in Cruise’s growth potential, but the details were significantly scaled down compared with a bullish report delivered to stockholders and analysts in July. Vogt was absent from the October call after getting a prominent speaking role in the summertime earnings report.
The DMV’s official notification to Cruise that its permits would be suspended came after that earnings call, but it’s unclear if the company knew the hammer was about to come down. A Cruise spokesperson said the company would never announce such an action ahead of state regulators and would not share rumors about a regulatory decision.
Since the DMV suspended its permits, Cruise announced it was pulling its driverless fleet of almost 1,000 cars off the road. Then just last week, all of Cruise’s cars, including those with human drivers, were recalled.
Many within the company do not expect it will receive new permits to operate in California until the middle of next year at the earliest. This could open the door for Waymo, which continues to operate 250 cars in San Francisco, or a fledgling competitor like Zoox to capitalize.
Philip Koopman, a professor at Carnegie Mellon University who has been working on autonomous vehicle safety for more than 25 years, said the focus should be less on winning the robotaxi race and more on making sure safety becomes the top priority for Cruise and others.
“We’re in the first mile of a marathon,” Koopman said. “Talking about who’s in the lead isn’t a particularly productive conversation. What we should focus on is who is really serious about safety. And what are their plans for sustainable growth?”
In a more positive turn, the prospects for the woman injured in the Oct. 2 crash in San Francisco appear to be looking up. Christine Falvey, a spokesperson for Zuckerberg San Francisco General Hospital, said the woman is still in the hospital but is now in “good condition.”
