Cruise executives are taking a measured business approach that conserves cash and improves safety culture in an effort to put General Motors Co.’s struggling self-driving car company on the right track.
The first steps in this rebuilding plan, which includes pausing production on the Origin robotaxi, were outlined in an internal email sent to employees by Mo El-Shenawy, who was executive vice president of engineering at Cruise and rose to president after the co-founder. CEO Kyle Vogt resigned.
Currently, this strategy includes more “realistic” plans, according to El-Shenawy. That means focusing on its existing Chevy Bolt AV robotics platform rather than the custom-designed Origin shuttle that GM began producing earlier this year. GM recently temporarily halted production of the Origin. This latest email indicates that while the Origin software will continue to be developed, the vehicle will not be produced in 2024. The company is also reviewing its layoff plans and will provide an update in several weeks.
While El-Shenawy did not provide a timeline for when Cruise will resume operations, he did say that the company will relaunch in only one city initially. This is a departure from the aggressive multi-city launch strategy that Cruise and GM have focused on in 2023.
“As we work to rebuild trust with regulators and communities, we have made the decision to focus on Bolt-based Cruise AVs in the near term with a long-term strategy around Origin,” the company wrote in an emailed statement in response. To internal email. “Once we take steps to improve our safety culture and rebuild trust, our strategy is to relaunch in one city and prove our performance there, before expanding.”
The internal email also provided some clarification surrounding the employee stock sale program, which was recently suspended for the fourth quarter. Vogt reversed that highly unpopular decision over the weekend, but employees are still waiting for more information. Employees who owned restricted stock units that settled from the beginning of the year through October will be eligible for a new tender offer to help with tax qualifications, the email sent Wednesday said.
The internal email comes three days after Vogt abruptly resigned and about a month after the California Department of Motor Vehicles suspended Cruise’s permits to operate autonomous vehicles on public roads after an Oct. 2 accident that involved a pedestrian — who was initially hit by a car driven by a human. It landed in the path of a Cruise robo-taxi – it ran over and was dragged 20 feet by an AV vehicle. A video, seen by TechCrunch a day after the incident, showed the robotaxi braking hard and stopping on top of the woman. The DMV’s suspension order stated that Cruz withheld about seven seconds of video footage, which showed the robo-taxi then trying to stop the woman and then pulling her 20 feet away.
Cruz, who already faced growing opposition from city officials in San Francisco, soon found himself constrained by investigations and pressure to cease operations. Without business permits to operate in San Francisco and an internal decision to temporarily park its self-driving fleets in other states, the company has laid off contract workers, exacerbating the problem.