Cruise is reportedly planning to lay off employees after weeks of crises

Table Of Content

• GM's Cruise laying off 900 employees, or 24% of its workforce: Read the memo here
• Cruise is reportedly planning to lay off employees after weeks of crises
• Cruise lays off nearly a quarter of its staff after grounding its robotaxi fleet
• Cruise robotaxis in crisis: Layoffs, recall, and algorithm found to have blind spot for kids
• Cruise Ends Stock Buybacks For Employees Amid Ongoing Safety Crisis

During the first nine months of this year Cruise posted pretax losses of $1.9bn. GM has lost $8.2 billion on Cruise since 2017 but expects to lose much less going forward. In a recent call with investors, the automaker didn’t share specific cash reductions, but chief financial officer Paul Jacobson said it would likely amount to “hundreds of millions” of dollars. “We knew this day was coming, but that does not make it any less difficult—especially for those whose jobs are affected,” he wrote. GM, which acquired Cruise in 2016, was rewarded by shareholders for the cutbacks.

Cruise is reportedly planning to lay off employees after weeks of crises - Engadget

Cruise is reportedly planning to lay off employees after weeks of crises.

Posted: Wed, 08 Nov 2023 08:00:00 GMT [source]

GM's Cruise laying off 900 employees, or 24% of its workforce: Read the memo here

Cruise issued Wednesday a recall for 950 vehicles equipped with its autonomous vehicle software following the October 2 crash that left a pedestrian, who had initially been hit by a human-driven car, stuck under and then dragged by one of the company’s robotaxis. The company told employees the decision was made for a few reasons, including that driverless operations had been paused or “deprioritized as we focus on supervised driving for the time being,” according to an internal message sent early Thursday morning and viewed by TechCrunch. The company laid off Thursday contingent workers, people who were employed to support its driverless fleet. These included jobs cleaning, charging and maintaining the vehicles as well as answering customer support inquiries, according to spokesperson Tiffany Testo. Vendors will make their own determination about severance for those workers, according to Testo.

Cruise is reportedly planning to lay off employees after weeks of crises

Cruise co-founder and CEO Kyle Vogt told employees during an all-hands meeting Monday that layoffs were coming, sources who were on the call told TechCrunch. Elshenawy was listed as the author of the memo informing staff of the layoffs, which offered details about severance, benefits and career support. Laid-off Cruise employees are being offered at least 16 weeks of pay after their departures. Cruise announced a round of layoffs Thursday affecting contract workers who worked on its driverless ridehailing service, CNBC has learned.

Cruise lays off nearly a quarter of its staff after grounding its robotaxi fleet

On behalf of the SLT, the Cruise Board and GM, I'm truly grateful to everyone who has played a role in building Cruise and who has poured so much into the promise of making our roads safer and our world better. In a few moments, you will receive an email letting you know whether or not you are affected by this staffing reduction. If you are impacted, you will get details about what happens next in a subsequent email. We knew this day was coming, but that does not make it any less difficult—especially for those whose jobs are affected.

GM’s Cruise robotaxi unit lays off 900 workers with investigation into San Francisco crash ongoing - KRON4

GM’s Cruise robotaxi unit lays off 900 workers with investigation into San Francisco crash ongoing.

Posted: Thu, 14 Dec 2023 08:00:00 GMT [source]

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This week, the company, which has 4,000 employees, started laying off contingent workers who support the driverless fleet, with more layoffs to follow, according to TechCrunch. According to Forbes, the company’s CEO Kyle Vogt told staff of the decision in an all-hands meeting earlier this week. Cruise hasn’t yet decided who or how many people will lose their jobs, Vogt said, but promised to provide more details in the next three weeks.

Cruise used all-electric Chevy Bolt vehicles, which have been specifically manufactured to support its self-driving system, in its robotaxi fleet. The company intended to shift toward a custom-built autonomous vehicle called the Origin. Vogt resigned as CEO last month, which was soon followed by the departure of his Cruise co-founder Daniel Kan. Earlier this week, Cruise announced that nine top executives were being fired amid a probe into the company’s safety practices, including its chief operating officer and chief legal officer. After information shared during all-staff meetings by company leadership, including then-CEO Kyle Vogt, was leaked to the media, the employee said executives became much less transparent in company-wide meetings, breeding more mistrust in recent weeks.

These impacts are largely outside of engineering, although some Tech positions are impacted also. As you might have learned, yesterday, we took action to part ways with several SLT members. “We are simplifying and focusing our efforts to return with an exceptional service in one city to start with,” ElShenawy wrote. “As a result of our decision to slow down commercialization, we are restructuring to focus on delivering the improvements to our tech and vehicle performance that will build trust in our AVs [autonomous vehicles],” the letter said.

I am so sorry we have to do this by email, as I would prefer that we have a conversation with each of you. Unfortunately, given the scale of this change, this approach allows us to communicate to those who are impacted at the same time. We know you will want to say goodbye to your colleagues, so you will have access to Cruise email and Zoom for the next couple of hours (until 10am PT). Many of you will be impacted because we aren't commercializing as quickly, and therefore don't need support in certain cities or facilities. We didn't take any of these decisions lightly, though I know that isn't much of a consolation if you're someone affected by the actions we are taking today.

The autonomous vehicle company confirmed to Insider that some of its contract workers who were involved in the company's robotaxi operations had been laid off, but declined to provide a specific number or locations impacted. Craig and I believe this is a necessary step, and our leadership team and the board are fully aligned with how our go-forward U.S. staffing needs will map to the priorities ahead of us, and set up Cruise for the long term. We have also ended additional assignments of contingent workers who support our driverless operations, as we refined our go forward plans. In October, the California Department of Motor Vehicles suspended Cruise's deployment and testing permits for its autonomous vehicles, alongside a statement that said, "When there is an unreasonable risk to public safety, the DMV can immediately suspend or revoke permits." General Motors’ troubled Cruise autonomous vehicle unit is cutting over 900 jobs, about a quarter of its workforce, as it moves to reduce costs and remake itself after a grisly accident in San Francisco and subsequent regulatory scrutiny. Early last month, the company recalled all its robotaxis, which it had been testing on roads in California, and regulators accused Cruise of hiding the severity of the incident.

The company had 3,800 employees before Thursday's cuts, which also follow a round of contractor layoffs at Cruise last month. Affected employees will receive paychecks until Feb. 12 and at least an additional eight weeks of pay, plus severance based on tenure. The subsidiary announced the cuts on Thursday in a letter to Cruise’s 3,800 workers from its president and chief technical officer, Mo ElShenawy, who wrote that the layoffs were not the fault of the workers.

The California Public Utilities Commission pulled Cruise’s permit, which allowed it to charge for robotaxi rides, soon after. The agencies suspended Cruise’s permits after an October 2 incident, in which a pedestrian who was struck by a human driver and then landed in the adjacent lane, was then run over by a  Cruise robotaxi. The robotaxi initiated its brakes and came to a stop with the pedestrian under the vehicle.

Now leading the company is General Motors General Counsel Craig Glidden, who is serving as co-president with Cruise Chief Technology Officer Mo Elshenawy. “It felt like we were not being told the full story when folks left, especially when Dan and Kyle left,” the former employee said. “The 24% or so was a surprise in terms of the numbers that we saw coming out,” the laid-off employee said. The employee said they realized they were among the positions affected when Slack access was shut off Thursday morning. Cruise confirmed that the RLO has ended but declined to answer questions about what that means for employees.

Cruise closed the third quarter with $1.7 billion in cash, which should give it nine months of runway. Some sources suggest senior leadership adjusted the corporate bonus schedule to assuage workers who have described low morale throughout its ranks. Wrapping up the meeting, Vogt and other executives tried to exude confidence that the company would bounce back. Cruise ships are filling up again, but passengers have been reporting back quicker than crew members.

"We are still working through what that means for the company and who's going to be affected by that and we don't have all the answers yet," Vogt said, according to Forbes. "But what I can do is commit to providing more details within the next three weeks. So, importantly that's not when layoffs would occur for full time employees, that's when we're going to give you an update on what that timeline might be." Cruise CEO Kyle Vogt appeared to confirm that the company would have to go forward with layoffs of full-time staff, Forbes reported, citing audio of a Monday all-hands meeting that it had obtained. The workers impacted in the announced layoffs weren't directly employed by Cruise, but rather employees contracted through third-party vendors and staffing agencies. As a result of our decision to slow down commercialization, we are restructuring to focus on delivering the improvements to our tech and vehicle performance that will build trust in our AVs. Cruise announced it would be pausing driverless operations for a review by independent experts and later recalled all 950 of its cars to update software.

McNeill, who joined the Cruise board recently and was previously chief operating officer at Lyft and president of Tesla, now serves alongside GM Chair and CEO Mary Barra. Days later Cruise paused all of its driverless operations in other markets where it had more limited service, including Austin, Houston and Phoenix. South Florida's cruise companies are buoyed by a surge in passengers, but they're still paying for the pandemic interrupting their business. Carnival Corp.’s Princess Cruises this week canceled 11 fall sailings on its Diamond Princess, saying it couldn’t provide the level of service customers expect amid ongoing labor shortages. Norwegian Cruise Line Holdings Ltd., another large operator, told investors it’s had to limit capacity on the Pride of America because of staffing.

In the aftermath, the company hired two outside law firms to review Cruise’s safety protocols as well as determine whether Cruise purposefully withheld video footage from the California DMV of its driverless vehicle dragging the hit-and-run victim to the side of the road. The company issued a voluntary recall of all 950 Cruise vehicles earlier this month to update the software to prevent similar incidents in the future. Affected employees were primarily in the company’s commercial operations division, as well as related corporate functions, a spokesperson said. She added that the company’s top priority was to “do right” by these departing workers. Following the resignation of Vogt, Mo Elshenawy, the company’s VP for engineering, was promoted to president and chief technology officer.