About half of the workers at General Motors’ now-defunct Cruise robotaxi division will be let go.
The announcements follow two months after GM announced it will no longer finance Cruise, having spent over $10 billion since acquiring the self-driving vehicle company in 2016.
In an email message, Cruise announced today that it had made the difficult decision to let go of about half of its employees. We appreciate their enthusiasm and contributions in getting us to this point, and we are committed to helping them move forward with severance benefits and career guidance.
As of the end of last year, Cruise employed close to 2,300 people, a GM representative previously told CNBC.
“The 50% reduction came as a result of the change in strategy we announced in December,” Cruise President and Chief Administrative Officer Craig Glidden wrote in an internal email sent Tuesday morning to all Cruise workers, which CNBC was able to access.
Glidden stated, “Our staffing and resource needs have drastically changed as we move away from the ride-hail business and toward providing autonomous vehicles to customers alongside GM.”
The CEO, Marc Whitten; the chief human resources officer, Nilka Thomas; the chief safety officer, Steve Kenner; and the top government affairs officer, Rob Grant, will also be leaving this week, he added. According to Glidden, Mo Elshenawy, the president and chief technology officer, will continue to assist with transitional responsibilities at Cruise until the end of April.
Although the layoffs at Cruise were anticipated, executives had previously refused to comment on the precise number, as reported by TechCrunch.
The Detroit manufacturer announced the employment losses at the same time that Cruise became a fully-owned subsidiary of GM, which is now concentrating on personal autonomous vehicles instead of robotaxis.
According to the corporation, affected employees were given 60 days’ notice, and about 88% of the remaining staff are in engineering or similar areas.
The impacted employees will get eight weeks of severance compensation in addition to their full base salary for the remaining time they work for Cruise. According to the corporation, workers who have worked for Cruise for more than three years would be paid an extra two weeks for each extra year.
“We are focused on combining efforts with General Motors to accelerate autonomy at scale on personal autonomous vehicles, even though it was not an easy decision,” Cruise stated.
Up until the company grounded its fleet of robotaxis and declared the end of its commercial operations late last year, GM’s Cruise and Waymo, which was sponsored by Alphabet, were regarded as industry leaders. Following an accident in October 2023, external investigations revealed that the corporation had misled or manipulated regulators about the occurrence.
A third-party investigation of Cruise in January 2024 found that the company’s regulatory oversights and cover-up concerns were primarily caused by culture difficulties, incompetence, and bad leadership.
The study partially addressed the issue that has surrounded Cruise since an accident on October 2, 2023, in which a pedestrian in San Francisco was hit by a separate car and then dragged 20 feet by a Cruise robotaxi. The investigation’s findings, which examined whether Cruise representatives mislead investigators or media members when discussing the incident, were released in a 105-page report many months later.
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