Struggling cruise is cutting about 25 percent of its employees

Cruise, General Motors’ embattled self-driving car subsidiary, said Thursday it would cut about 900 jobs, about a quarter of its workforce, as the company sought to rein in costs after an October incident led to California regulators had to close their doors. its robot taxi operations.

Most of the job losses are in corporate and commercial roles, which have become less important since the company voluntarily suspended all its driverless operations across the country in October. The closure came two days after the California Department of Motor Vehicles said the company had “misrepresented” its technology and ordered Cruise to stop operating in the state.

Cruise’s problems trace back to an accident on October 2 when a car struck a woman at an intersection in San Francisco and threw her into the path of one of Cruise’s self-driving taxis. The cruise car dragged the woman about 20 feet before hitting the curb, causing serious injuries. Regulators accused Cruise of omitting footage of the car towing the woman from a video it provided to government officials.

Since then, GM, which bought the self-driving car startup for $1 billion in 2016, has stepped in to push Cruise forward. The company hired the law firm Quinn Emanuel to investigate the crash and Cruise’s response. The self-driving automaker’s founders, Kyle Vogt and Dan Kan, resigned last month. And yesterday the company fired nine senior managers, including the heads of Operations and Public Affairs.

Instead of appointing a new CEO, GM named two presidents reporting to the board of directors: Mo Elshenawy, Cruise’s executive vice president of engineering, and Craig Glidden, GM’s general counsel.

The company has been preparing employees for layoffs for more than a month; At the end of October, Mr Vogt told employees at a company-wide meeting that the loss of turnover resulting from the cessation of activities would lead to cutbacks.

“We knew this day would come, but that doesn’t make it any less difficult – especially for those whose jobs are affected,” Mr Elshenaway said in An email to the staff on Thursdaythat was posted on the company’s website.

Cruise said laid-off employees would continue to receive their wages through April 8, have health benefits through May and receive their bonuses for 2023. The news of the layoffs was previously reported by tech news site TechCrunch.

The layoffs come at the end of a year of cuts in the tech industry. Major tech companies, including Microsoft and Google’s parent company Alphabet, cut tens of thousands of jobs this year as they tried to cut costs after hiring too many workers during the pandemic.

This is a development story. Check back for updates.