Cruise will eliminate about half its workforce as the General Motors (NYSE: GM) subsidiary abandons its robotaxi ambitions to focus on personal autonomous vehicles, company officials said Tuesday.
The cuts affect approximately 1,150 employees at Cruise, which GM acquired in 2016 and supported with more than $10 billion before suspending funding in December.
“With our move away from the ride-hail business and toward providing autonomous vehicles to customers alongside GM, our staffing and resource needs have dramatically changed,” Cruise President and Chief Administrative Officer Craig Glidden told employees in an internal message.
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The restructuring triggers a leadership exodus, including Chief Executive Marc Whitten, Chief Human Resources Officer Nilka Thomas, Chief Safety Officer Steve Kenner, and Chief Government Affairs Officer Rob Grant. Chief Technology Officer Mo Elshenawy will remain through April to assist with the transition.
Engineers will comprise 88% of the remaining workforce as Cruise integrates more closely with its parent company. Departing employees will receive 60 days’ notice and at least eight weeks of severance.
The downsizing follows Cruise’s October decision to halt its autonomous taxi service after a vehicle dragged a pedestrian 20 feet in San Francisco. An independent investigation later found the company had not been transparent with regulators about the incident.
The probe, released in January, pointed to deeper problems at Cruise, describing a culture that enabled poor oversight and misleading communications. The setbacks derailed a company that had competed directly with Alphabet’s (Nasdaq: GOOG) Waymo for leadership in autonomous driving technology.
GM has now made Cruise a wholly owned unit focused on developing self-driving technology for personal vehicles rather than ride-hailing services.
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