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Cruise, the troubled autonomous-vehicle unit of General Motors Co., has dismissed nine “key leaders” and said it plans to lay off more than 20% of its workforce in the wake of an October crash in San Francisco that left a pedestrian critically injured.
Among those departing the company are its legal, government affairs, commercial operations, and safety and systems leaders, Cruise said in an emailed statement Wednesday.
On Thursday, GM
GM,
confirmed that it was cutting 24% of Cruises’s workforce, or around 900 employees. The reductions will mostly affect those workers in “commercial operations and related corporate functions,” Cruise said.
“These changes reflect our decision to focus on more deliberate commercialization plans with safety as our north star,” Cruise said in a statement.
For its turn, GM said it “supports the difficult employment decisions” Cruise has made. “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.”
Cruise co-founder and CEO Kyle Vogt resigned last month following the suspension of Cruise’s operations on public roads.
The company said Wednesday’s moves follow an “initial analysis” of the Oct. 2 incident, in which a Cruise driverless vehicle ran over a pedestrian who had first been hit by another vehicle, then dragged the pedestrian about 20 feet.
Following that, California regulators suspended the company’s license to operate in the state, and accused Cruise of attempting to cover up the severity of the incident, which could result in a $1.5 million fine.
After the crash, Cruise suspended all of its operations on public roads in the U.S. and said it planned an independent, third-party investigation into what happened.
Cruise had been given free rein earlier this year to operate driverless taxis in San Francisco, and had also been operating driverless cars in Austin, Dallas, Houston and Phoenix.
But even before the crash, Cruise was piling up losses for GM.
In its most recent earnings report in October, GM reported a $1.9 billion loss for its Cruise business between January and September, including $732 million in third-quarter losses.
GM Chief Executive Mary Barra said in late November that while the automaker is committed to Cruise, it plans “substantially lower spending” on Cruise in 2024. It also scaled back plans for its Origin driverless taxi.
Claudia Assis contributed.
