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Cruise, the embattled GM self-driving car subsidiary, is laying off 900 employees, or about 24% of its workforce, as part of a plan to slash costs and attempt to revamp the company following an October 2 incident that left a pedestrian stuck under and then dragged by one of its robotaxis.
An email, penned by newly minted president and CTO Mo Elshenawy, was sent this morning to the entire 3,800-person workforce. The email, which TechCrunch has viewed, began with a resigned tone: “We knew this day was coming, but that does not make it any less difficult—especially for those whose jobs are affected,” Elshenawy wrote.
Cruise is targeting non-engineering jobs in the layoffs, particularly those people who worked in the field, commercial operations and corporate staffing, according to the email. The company has also ended additional assignments of contingent workers who supported its driverless operations. Engineering, a category that makes up the bulk of the Cruise workforce, is largely being preserved, according to the content of the email and discussions with internal sources.
The email continued:
“Today, we are making staff reductions that will affect 24% of full-time Cruisers, through no fault of their own. We are simplifying and focusing our efforts on returning to service in a more limited set of markets and on a simplified set of platforms. As a result, we are reducing our employee counts in operations and other areas. These impacts are largely outside of engineering, although some engineering positions are impacted also.”
The layoffs come just a day after nine senior leaders (SLT) at Cruise, who worked in its commercial operations, legal and policy departments, were dismissed by the company’s board. COO Gil West and David Estrada, who was head of government affairs, were among that group.
Elshenawy reiterated the company would be narrowing and refocusing its efforts, information shared last month following the resignation of co-founder and CEO Kyle Vogt and some executive shuffling that included naming Jon McNeill as co-chair of the Cruise board and appointing Craig Glidden, GM’s EVP of legal and policy and a Cruise board member, as chief administrative officer at Cruise.
The layoffs have been largely expected at Cruise for weeks now. Last month. GM Chair and CEO Mary Barra reiterated plans for Cruise to be more “deliberate” when operations eventually resume at the troubled self-driving vehicle subsidiary. For GM, that will include slashing spending at Cruise “by hundreds of millions of dollars” in 2024, an action that most expected would result in widespread layoffs.
GM and the Cruise board have been scrambling ever since the October 2 incident put the company in the crosshairs of state, local and federal agencies. However’s Cruise’s robotaxi operations in San Francisco have been criticized by the public and city officials almost immediately after the California Public Utilities Commission issued the company in August the final permit required to operate commercially. Videos of Cruise robotaxis blocking traffic and driving into a construction site were shared on social media. But it was a crash with an emergency response vehicle that began to chip away at the company’s seemingly impenetrable exterior.
This story is developing ….
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