GM’s Cruise To Slash 24% Of Its Workforce As Part Of Restructuring

Cutout paper illustration representing scheme and Stocks inscriptionImage Source: PexelsAfter GM announced it was cutting back its investment in its Cruise subsidiary following a pedestrian accident earlier this year, the division now says it is cutting 24% of its workforce as part of its restructuring. The autonomous driving unit says it will lay off 900 of its 3,800 employees, most of whom are in commercial operations and related corporate functions, according to Reuters. “This reflects our new future and a more deliberate go-to-market path, meaning less immediate need for field, commercial operations, and corporate staffing,” Cruise said in a statement this week. “GM supports the difficult employment decisions made by Cruise as it reflects their more deliberate path forward, with safety as the north star,” GM said of the division during an earnings call last month. Recall we reported the slashing of investment in the unit about two weeks ago. The division, which had previously operated under the motto “zero crashes, zero emissions, zero congestion,” announced in late November it would be cutting its budget, according to FT.FT reported at the time that the division won’t drop its slogan entirely, but will spend less on the segment. GM had previously invested about $700 million per quarter and Cruise operated in several U.S. cities, with San Francisco being the most prominent. Barclays auto analyst Dan Levy, speculating as to whether or not financial conditions could further mire the project, told FT at the time: “The big question is to what extent ‘Zero Zero Zero’ also hinged on zero rates.”“This has been a big theme this year in auto; everyone has had to step back from the euphoria,” he added. One GM investor said in late November: “The problem for Cruise as a business is GM is dependent on it for all the software [revenue] targets the company has set. We don’t see a path to profit, but we do see they will burn a lot of cash trying. GM would be better placed winding back its bet, and returning the money to shareholders.”Recall, we just in early November that about 11 days after Cruise halted all autonomous vehicle deployment across the US following several collisions and a suspension of its permit to operate robot taxis in California, Forbes revealed that Cruise CEO Kyle Vogt held an all-hands meeting to halt production of its fully autonomous vans temporarily. The fallout continued as Vogt, according to audio obtained by Forbes, told employees that suspending driverless operations nationwide was the primary reason why it must pause “production of the Origin” van. Vogt said Cruise has produced hundreds of Origin vehicles and “more than enough for the near-term when we are ready to ramp things back up.” “During this pause, we’re going to use our time wisely,” he explained.More By This Author:Empire Fed Manufacturing Unexpectedly Crashes Into ‘Contraction’ECB Holds Rates Steady, Cuts Growth & Inflation Outlooks Fed ‘Dovish Pivot’ Sparks Panic-Bid In Bonds, Stocks, & Gold


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