Cruise, GM’s Robotaxi Subsidiary, Hits the Breaks with Layoffs
Cruise, Troubled Robotaxi Developer, Suffers Massive Layoffs Amidst Turbulent Times
Massive layoffs at Cruise, the troubled robotaxi developer.
Cruise, General Motors’ ambitious self-driving development subsidiary, is hitting the breaks on its expansion plans. In a surprising move, the company announced that it will be laying off nearly a quarter of its workforce—around 900 employees. These cuts are part of a larger restructuring effort aimed at streamlining Cruise’s path to commercialization.
Now, you might be wondering why Cruise is putting the brakes on its rapid expansion. Well, according to Mo ElShenawy, the company’s co-president and CTO, Cruise wants to prioritize safety before scaling up. In a letter to employees, ElShenawy explained that Cruise aims to enhance its safety standards and processes before venturing into multiple US cities. So instead of expanding its commercial robotaxi service far and wide, Cruise will focus on relaunching its currently paused service in just one city.
But don’t be fooled, this decision doesn’t come without consequences. The cuts at Cruise add to an already tumultuous fall for the company. Just last month, Cruise had its permit to operate in San Francisco suspended by California regulators. They alleged that the company failed to disclose details of a crash that left a pedestrian seriously injured. Ouch!
In response to the safety concerns, Cruise took swift action and halted autonomous vehicle testing and operations across the US. Talk about a sudden stop! Prior to the crash, Cruise was operating robotaxi services in Austin, Texas, and Phoenix, Arizona, with plans to launch in other cities like Houston, Dallas, and Miami. But now, those plans are on hold.
To make matters even more interesting, Cruise also bid adieu to nine top executives, including leaders in legal, government affairs, commercial operations, and safety and systems. These departures stem from a safety review prompted by the San Francisco crash. Cruise is determined to rebuild trust and operate with the highest standards of safety, integrity, and accountability. Clearly, they believe new leadership is essential to achieve these goals.
Despite the rocky road, General Motors, the proud parent of Cruise, remains supportive and understanding. A General Motors spokesperson stated that they stand behind Cruise’s deliberate path forward, with safety as their guiding principle. After all, General Motors acquired Cruise back in 2016 and has invested billions of dollars into the venture, so they’re in it for the long haul.
However, it’s important to note that General Motors hasn’t been immune to financial losses either. According to financial filings, the company has lost a staggering $8 billion on Cruise since 2017. This year alone, they’ve spent at least $1.9 billion on the self-driving developer. In an effort to cut costs, General Motors recently announced that they would reduce funding for Cruise by “hundreds of millions” of dollars in 2024. It seems like even big automakers have to tighten their belts sometimes.
Now, you may be wondering what all this means for Cruise’s futuristic robotaxi, the Origin. Well, buckle up because there’s a twist. General Motors recently halted production of the Origin, a unique six-seat cube on wheels that doesn’t have a steering wheel. The vehicle needs federal approval to hit the roads due to its unconventional design, but that may be a roadblock they can overcome. In the meantime, Cruise will be focusing on the Bolt platform—a more conventional electric car—for their scaled-down operations.
In conclusion, Cruise’s decision to pump the brakes on expansion and focus on safety may seem like a setback. However, it’s crucial for them to build trust and ensure the highest standards before hitting the road again. With General Motors standing behind them, Cruise may find a smoother path ahead. So hold on tight and stay tuned for the next exciting chapter in the self-driving saga!
What do you think of Cruise’s strategy? Do you believe they can regain their position as leaders in the race to automate driving? Share your thoughts in the comments below!
