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GM’s Cruise laying off 900, or 24% of its workforce

The layoffs are the latest turmoil for the robotaxi startup and come one day after Cruise dismissed nine “key leaders” for the company’s response to the October accident.
Test Drive Robot Car Cruise
A GM Cruise on a test drive in San Francisco, on Nov. 5, 2019.Andrej Sokolow / picture alliance via Getty Images file
/ Source: CNBC.com

General Motors’ Cruise on Thursday announced internally that it will lay off 900 employees or 24% of its workforce, the company confirmed to CNBC.

The layoffs are the latest turmoil for the robotaxi startup and come one day after Cruise dismissed nine “key leaders” for the company’s response to the October accident. The cuts also come roughly a month after a round of layoffs of contract workers at Cruise.

The company had 3,800 employees before layoffs.

In a statement, a Cruise spokesperson said, “We shared the difficult news that we are reducing our workforce, primarily in commercial operations and related corporate functions. These changes reflect our decision to focus on more deliberate commercialization plans with safety as our north star. We are supporting impacted Cruisers with strong severance and benefits packages and are grateful to the departing employees who played important roles in building Cruise and supporting our mission.”

GM added, “GM supports the difficult employment decisions made by Cruise as it reflects their more deliberate path forward, with safety as the north star. We are confident in the team and committed to supporting Cruise as they set the company up for long-term success with a focus on trust, accountability and transparency.”

A barrage of safety concerns and incidents have plagued Cruise, majority-owned by GM, since it received approval in August for round-the-clock robotaxi service in San Francisco. The string of investigations were sparked by an Oct. 2 accident in which a pedestrian was dragged 20 feet by a Cruise self-driving car after being struck by another vehicle.

Since the October accident, Cruise’s robotaxi fleet has been grounded, pending the results of independent safety probes; its leadership has been gutted; production of a new robotaxi has been halted; hundreds of vehicles have been recalled; and local and federal government investigations have launched their own investigations, among other concerns.

In October, the California Department of Motor Vehicles suspended Cruise’s deployment and testing permits for its autonomous vehicles, alongside a statement that “When there is an unreasonable risk to public safety, the DMV can immediately suspend or revoke permits.”

Cruise’s decision to suspend all trips on public roads last month came after a board meeting at the company’s HQ, after which it also announced a reorganization, more oversight from GM, an independent “safety expert” that would assess the company’s safety operations and an expanded probe into Cruise’s tech and safety systems by Exponent, the engineering consulting firm Cruise hired to analyze the Oct. 2 crash. Exponent’s investigation is still ongoing, according to Cruise.