General Motors-owned Cruise began laying off employees just one day after its robotaxi operations were paused due to a recall prompted by safety concerns about the driverless cars.
The company announced the layoffs on Thursday, affecting contract workers responsible for tasks such as vehicle cleaning, fleet charging, and customer support, a spokesperson told.
“Cruise has made the difficult decision to reduce a portion of the contingent workforce that supported driverless ridehail operations,” the representative stated.
Cruise did not specify the number of employees affected by the layoffs.
The company’s operations have faced several challenges, culminating in a recall of its entire fleet of 950 autonomous vehicles for a software update aimed at enhancing the vehicles’ “Collision Detection System.”
These layoffs and the recall are the latest setbacks for Cruise, which reported a $723 million loss in the third quarter and had its driverless vehicle permit suspended by the California Department of Motor Vehicles.
GM’s stock dropped more than 3% on Thursday but saw a slight rebound on Friday.
Just weeks before the suspension, on October 2, a Cruise vehicle without passengers struck a pedestrian in San Francisco, dragging her approximately 20 feet and causing serious injuries before coming to a stop.
The pedestrian, an unnamed woman, was so tightly wedged under the vehicle’s left rear axle that she had to be freed using the Jaws of Life.
Cruise stated that the vehicle was braking “aggressively” to minimize the impact and later announced that its teams were analyzing the incident to identify possible improvements to the autonomous vehicle’s response to such rare events.
The California DMV cited the incident as a reason for concluding that Cruise’s vehicles were not safe for public operation.
“The manufacturer has misrepresented information related to the safety of the autonomous technology in its vehicles,” the DMV stated.
Cruise founder and CEO Kyle Vogt confirmed that the October 2 accident led to the recall but noted that it was not the only incident.
In August, a Cruise robotaxi was also involved in a collision with a fire truck responding to an emergency in San Francisco, where autonomous vehicles are increasingly sharing the roads with human drivers.
After that incident, Cruise conducted an investigation and reported that the car “did identify the risk of a collision and initiated a braking maneuver, reducing its speed, but was ultimately unable to avoid the collision.”
