GM’s Cruise cutting 24% of workforce, fires 9 execs amid robotaxi safety probe
General Motors said new leadership is necessary to rebuild trust and standards for its Cruise robotaxi unit
The driverless car allegedly did not yield to the firetruck's flashing lights as it went through the intersection on Aug. 17, 2022. (John Freeman)
General Motors' self-driving vehicle unit, Cruise, announced layoffs on Thursday amid an ongoing safety investigation into its robotaxis, impacting nearly one in 4 employees.
"As a result of our updated operating plans, today Cruise shared the difficult news that we are making staff reductions impacting 24% of full-time Cruisers," Cruise said in a team update.
The announcement came shortly after GM let go of nine Cruise executives amid the safety probe, including Chief Operating Officer Gil West, FOX Business confirmed.
GM previously shut down Cruise's robotaxi operations for a safety probe after a woman was struck and dragged by a Cruise vehicle in San Francisco on Oct. 2.
GM'S CRUISE CEO KYLE VOGT RESIGNS FROM COMPANY
A self-driving GM Bolt EV is seen during a media event where Cruise, GM's autonomous car unit, showed off its self-driving cars in San Francisco on Nov. 28, 2017. (REUTERS/Elijah Nouvelage / Reuters Photos)
Cruise has faced intense scrutiny from California regulators since the accident. CEO Kyle Vogt and co-founder Dan Kan both resigned in recent weeks and layoffs were rumored for December.
"Following an initial analysis of the October 2 incident and Cruise's response to it, nine individuals departed Cruise," a company memo obtained by FOX Business states. The memo was first reported by Reuters.
"We are committed to full transparency and are focused on rebuilding trust and operating with the highest standards when it comes to safety, integrity, and accountability," the memo said. "As a result, we believe that new leadership is necessary to achieve these goals."
Reuters reported that Cruise Chief Legal and Policy Officer Jeff Bleich and Senior Vice President of Government Affairs David Estrada were among those who left the company.
GM TO HALT PRODUCTION OF CRUISE DRIVERLESS VAN
A protester holds a sign during a demonstration outside the California Public Utilities Commission in San Francisco on Aug. 7. (Justin Sullivan/Getty Images / Getty Images)
"The personnel decisions made today are a necessary step for Cruise to move forward as it focuses on accountability, trust and transparency," GM said in a statement.
The safety concerns are a major setback for Cruise, which had announced plans to expand its autonomous taxi service to more U.S. cities. The California DMV hit Cruise with an indefinite suspension after the accident, covering both its testing and deployment permits for robotaxis.
The National Highway Traffic Safety Administration has also launched a separate safety probe of the autonomous driving system in Cruise’s vehicles in December following a pair of rear-end crashes. The agency said the vehicles "may engage in inappropriately hard braking or become immobilized."
Law firm Quinn Emmanuel is leading the safety investigation, GM has said.
CRUISE PAUSES DRIVERLESS VEHICLE OPERATIONS ACROSS US DURING SAFETY INVESTIGATION
A Cruise, which is a driverless robot taxi, is seen during operation in San Francisco on July 24. (Tayfun Coskun/Anadolu Agency via Getty Images / Getty Images)
Cruise, in February 2022, petitioned U.S. regulators seeking permission to deploy up to 2,500 self-driving Origin vehicles annually without human controls like steering wheels.
The company announced two weeks ago that it plans to stop production of its Cruise Origin van, with a GM spokesperson telling Reuters that "we are finishing production on a small number of pre-commercial vehicles and after that, plan to temporarily pause production."
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| GM | GENERAL MOTORS CO. | 56.25 | -0.79 | -1.38% |
| HMC | HONDA MOTOR CO. LTD. | 26.52 | +0.70 | +2.71% |
The Cruise Origin vehicle, built in Detroit, was jointly developed by GM, Cruise and Honda.
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Cruise could face $1.5 million in fines and additional sanctions over its failure to disclose details surrounding the accident, a California agency has said.
Mo Elshenawy took over as Cruise's president last month and told an all-hands meeting earlier this month that the autonomous vehicle unit has hit an "all-time low."
FOX Business' Greg Norman and Eric Revell and Reuters contributed to this report.