General Motors’ self-driving Cruze is seen outside the company’s headquarters in San Francisco.
Heather Somerville | Reuters
General Motors’ self-driving vehicle unit has fired nine “key leaders” amid ongoing safety investigations sparked by an October accident in San Francisco, according to an internal letter obtained by CNBC.
The departures include leaders from Cruise’s legal, government affairs, business operations, safety and systems teams, according to the company-wide letter, which GM and Cruise spokespeople confirmed to be authentic.
“New leadership is essential” for the company to restore trust and operate “at the highest standards when it comes to safety, integrity and accountability,” the letter said.
Cruise’s problems are the latest in the autonomous vehicle industry. Commercializing autonomous vehicles has been much more difficult than many expected even a few years ago. Challenges have led to consolidation in the autonomous vehicle sector after years of enthusiasm touting the technology as the next multi-trillion-dollar market for transportation companies.
Change in Cruz, who was Reported for the first time By Reuters This follows an initial analysis of the company’s response to an incident on October 2, in which a pedestrian was dragged after being hit by another vehicle.
Following the accident, the California Department of Motor Vehicles suspended deployment and testing permits for its autonomous vehicles in late October. Cruz then followed up by temporarily halting all U.S. road operations
The company also faces regulatory pressure and fines for potentially misleading or withholding information about the incident. The National Highway Traffic Safety Administration and the California Public Utilities Commission are investigating the accident.
GM CEO Mary Barra, who serves as Cruise’s president, said last week in Detroit that the company is “very focused on righting the ship” at Cruise. Its procedures include two ongoing external safety reviews that will guide the company’s path forward. It is expected to be completed in early 2024, she said.
“The personnel decisions made today are a necessary step for Cruise moving forward as it focuses on accountability, trust and transparency. GM remains committed to supporting Cruise in these efforts,” GM said in an email statement on Wednesday.
The additional departures come about a month after Cruise CEO and co-founder Kyle Vogt and co-founder and chief product officer Dan Kahn resigned.
This is also a setback for an industry that relies on public trust and cooperation from regulatory bodies. In recent months, the unit has promoted ambitious plans to expand into more cities and provide fully self-driving taxi trips.
GM bought Cruise in 2016. It then brought in investors like Honda Motor, SoftBank Vision Fund and, more recently, Walmart and Microsoft. However, last year, GM acquired SoftBank’s ownership stake for $2.1 billion.
GM executives, including Barra, had hoped the startup would bolster its driverless transportation network this year, and they hoped Cruise would play a prominent role in doubling the company’s revenues by 2030.
But so far, Cruise has cost GM more than $8 billion since the company acquired it in 2016, according to public filings. Losses are increasing annually, including $1.9 billion until the third quarter of this year.
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