General Motors’ Cruise confirmed to CNBC on Thursday that the company announced internally that it would lay off 900 employees, accounting for 24% of its total workforce.
The layoffs are the latest turmoil for the robo-taxi startup, a day after Cruise fired nine “key leaders” involved in the company’s response to an October accident. The layoffs also come about a month after a round of contract layoffs at Cruise.
The company had 3,800 employees before the layoffs. Affected employees will receive pay through February 12, plus at least eight weeks of additional pay, plus tenure-based severance pay.
“We share the difficult news that we are reducing our workforce, primarily in commercial operations and related corporate functions,” a Cruise spokesperson said in a statement. “These changes reflect our decision to focus on a more thoughtful commercialization plan and will Safety is our North Star. We are providing generous severance and benefits packages to affected Cruisers and express our gratitude to those departing employees who have played an important role in building Cruise and supporting our mission.”
GM added: “GM supports Cruise’s difficult hiring decision as it reflects their more prudent path forward with safety as their North Star. We have full confidence in the team and are committed to supporting Cruise’s long-term growth as a company.” Lay the foundation.” The keys to success are trust, accountability and transparency. “
A series of safety issues and accidents have plagued General Motors Co.’s Cruise since it was approved in August to provide round-the-clock robo-taxi service in San Francisco. The investigation was prompted by an October 2 incident in which a pedestrian was dragged 20 feet by a Cruise self-driving car after being hit by another vehicle.
Since the October accident, Cruise’s robo-taxi fleet has been grounded pending the outcome of an independent safety investigation; its leadership position has been undermined; production of new robo-taxi has been halted; hundreds of vehicles have been recalled; among other things In addition to concerns, local and federal government investigative agencies have launched their own investigations.
In October, the California Department of Motor Vehicles suspended Cruise’s license to deploy and test its autonomous vehicles, issuing a statement saying “the DMV may immediately suspend or revoke a license when an unreasonable risk to public safety exists.”
Cruise also announced a reorganization and more oversight from General Motors Co. after Cruise decided to suspend all public road travel last month following a board meeting at the company’s headquarters. Cruise hired engineering consulting firm Exponent to analyze the Oct. 2 accident and investigate Cruise’s technology and safety systems. Cruise said Exponent’s investigation is ongoing.
cruiser:
We knew this day was coming, but that doesn’t make it any harder – especially for those whose jobs have been affected.
Today, we are making layoffs that will affect 24% of our full-time Corvette workforce through no fault of their own. We are simplifying and focusing our efforts, starting with providing exceptional service in one city, and focusing on the Bolt platform before scaling up. As a result, we are reducing headcount in operations and other areas. These impacts largely extend beyond engineering, although some technical positions are also affected. As you may be aware, yesterday we took action to part ways with several SLT members.
Craig and I believe this is a necessary step and our leadership team and board of directors fully agree on how our future U.S. employee needs will map to the priorities before us and build Cruise for the long term. As we refine our plan moving forward, we are also ending the additional tasks of temporary workers supporting our autonomous operations.
You will receive an email shortly to let you know if you are affected by this staffing reduction. If you are affected, you will receive details on what happens next in a follow-up email.
Please note that our first priority is to treat departing cruisers fairly, and I will describe in detail below how we do this.
I also want to explain why we’re making these cuts and what that means for Cruise moving forward.
Cruise today and Cruise tomorrow
As we shared, we aim to focus our efforts on fully driverless L4 services that meet new AV performance standards, prioritizing the Bolt platform, relaunching ride-hailing services in one city, and scaling Improving our safety standards and processes before. We will cease work on Origin MY24, but will not neglect our work on future projects. This is significantly different from our previous plan to expand to a dozen new cities in 2024.
As a result of our decision to slow commercialization, we are reorganizing and focusing on improving our technology and vehicle performance to build trust in our autonomous vehicles.
Many of you will be affected because we are not commercializing fast enough to require support from certain cities or facilities. In other cases, we restructure teams based on our priorities. We do not make these decisions lightly, but I know that is no comfort if you have been affected by the actions we have taken today.
How we help former employees
We know there is no “good” way to lay off employees, but treating outgoing employees fairly is a key principle guiding our approach, and our first priority is determining how to provide a strong severance package while treating departing Corvettes with respect. In short, we will provide payroll for outgoing Cruisers until at least April 8, 2024 (approximately 16 weeks), in addition to ongoing health care subsidy, RSU vesting, January 5th bonus, and continued support for the remaining Cruisers. Additional immigration support is provided for those with work visas. Severance package details include:
- Severance pay: Retiring employees will have their salaries retained until February 12 and will be eligible for an additional eight weeks of pay, while long-term employees who have worked at Cruise for more than three years will receive an additional two weeks of pay for each year.
- bonus: All affected employees will receive their 2023 bonus (qualified target payment) on January 5, 2024.
- Medical, Dental, Vision: We will offer cruise passengers and their dependents currently enrolled in cruise benefits the option to receive cruise-subsidized medical, dental and mental health/EAP benefits through the end of May.
- Welfare wallet: We’ll give cruisers two months to access the perks that matter most to them through our perks wallet.
- 401(k): We will give Cruisers two months to continue making contributions to their 401(k) plans, including our employer match.
- RSU ownership: All cruisers, both affected and remaining, will receive RSU vests on January 15th. Additionally, we will provide liquidity for all January 15 shares in the first quarter based on updated 409A fair market valuations that we will conduct in the first quarter. There will be no tax liability for these shares that vest on January 15th until we provide you with liquidity for these shares.
- Career support: Leaving employees will receive a one-year LinkedIn Premium subscription, and we will create an opt-in alumni directory to connect potential employers with affected Cruisers. Cruise Line Talent Acquisition will also be hosting resume building, networking and interview preparation workshops for departing cruise personnel in the new year.
- Immigration support: In lieu of one-time severance payments, we will provide ongoing payroll through March 24 to give visa holders more time to help transition and manage their immigration status. Eligibility for Perks Wallet and 401(k) contributions and matching will also continue during this time. We also offer dedicated support to assist cruisers based on their needs.
Our message to other employers in the market is that each departing Cruiser is a talented, driven, mission-focused team member who will contribute and achieve great things elsewhere. They leave us through no fault of their own. Other companies would be honored to have these professionals join their teams, just as we are honored to have them here during their tenure at Cruise.
what’s next
As mentioned, you will receive an email shortly to let you know if you are affected by this staffing reduction, and if you are affected, you will get details about what happens next. I’m sorry that we have to do this via email, as I would rather we have a conversation with each of you. Unfortunately, given the scale of this change, this approach allows us to communicate with those who are affected at the same time. We know you’ll want to say goodbye to your colleagues, so you’ll have access to Cruise email and Zoom over the next few hours (until 10 a.m. PT).
This has been one of the hardest days we’ve had so far because so many talented people have left. I’m grateful we had the opportunity to work together, and I know I speak for many cruisers who will be reaching out to those who are leaving to help build professional networks and referrals. On behalf of SLT, the Cruise Board of Directors and General Motors, I would like to express my sincere gratitude to everyone who plays a role in building Cruise and who works so hard to make our roads safer and our world a better place.
This is breaking news. Please check back for additional updates.
Svlook
