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Cruise lays off 900 employees

Self-driving car company Cruise finds itself navigating perilous terrain amid troubles that threaten its very existence. Once seemingly poised to lead the autonomous vehicle revolution, Cruise now confronts cascading crises - both internal and external - that have brought its ambitious vision to a shuddering halt.

The most immediate crisis is Cruise's suspension of all operations, nationwide, after California's DMV revoked the company's testing and deployment permits last month. Regulators slapped Cruise’s wrist for allegedly misrepresenting safety incidents and operating robotaxis that posed an “imminent risk to public safety.” While disputes surround the DMV’s specific claims, the episode crystallized growing alarm over Cruise’s safety record after a spate of high-profile incidents in recent months.

Cruise also faces leadership turmoil at this critical juncture. Visionary co-founder and CEO Kyle Vogt resigned abruptly in late November alongside Chief Product Officer Dan Kan. Their exits capped months of behind-the-scenes tensions over Cruise’s direction amid its safety troubles. While respected technologist Mo Elshenawy has taken over the helm, his background is more nuts-and-bolts engineering rather than the bold futurist vision that animated Cruise’s culture under Vogt.

Most challenging of all, Cruise must now rebuild trust with regulators, partners, investors, employees, and customers. Its autonomous vehicle aspirations hinge on satisfying skeptical stakeholders that Cruise vehicles are safe enough for public roadways. technical prowess alone cannot surmount such existential threats.

Cruise therefore confronts complex intertwined crises - technical, cultural, regulatory, and reputational - that threaten its survival. Its response demands a nuanced, systematic strategy that balances short-term moves restoring legitimacy with a long-term roadmap fulfilling Cruise’s grand ambitions. Bold visions now require humble execution.

First, satisfy regulators. Cruise must convince authorities, especially California's formidable DMV, that it takes safety seriously and vehicles meet rigorous standards before resuming operations. Detailed incident reviews, beefed-up protocols, personnel moves, and transparency initiatives can help rebuild regulatory trust. But progress requires genuine soul-searching on systemic safety shortcomings.

Second, get culture right. As Cruise veterans exit, new leadership must nurture urgency alongside realism, confidence alongside humility, vision alongside wisdom. Safety can never be compromised, but timidity cannot substitute for principled risk-taking. Cruise needs honest reckoning on what went wrong paired with inspirational leadership charting a new path.

Third, focus priorities. In its rush to scale robotaxis across America, Cruise perhaps got ahead of itself operationally while innovating too slowly technologically. A streamlined mission targeting technical leaps in constrained environments, not nationwide ubiquity, provides firmer foundations. Patience and discipline now serve Cruise better than unchecked growth.

Finally, build partnerships. Isolation and insularity cannot solve complex challenges spanning technology, business, government, and society. Cruise must collaborate with cities, regulators, automakers, technologists, and communities to codevelop solutions grounded in public interest.

The road ahead remains long for Cruise. Its original timeline lies in tatters, its visionary founders have moved on, and existential questions surround its future. Yet promise still flickers in its pioneering technology if wisely shepherded. Cruise’s greatest test lies in learning from mistakes, regaining trust, and pursuing progress guided now by hard-won wisdom. Even in crisis lies opportunity, if Cruise can respond with maturity, integrity, and purposeful collaboration.
What’s next for Cruise?

In its email to employees sent this morning, Cruise said that it would be focusing on developing a fully driverless L4 robotaxi service. The company plans to re-launch its ride-hailing services in one city to start.

Cruise also said that it would be haunting operations on its purpose-built Origin vehicle. In October, Cruise announced that it would work with GM and Honda to roll these vehicles out in Japan in early 2026. It’s unclear if the company is still planning for this deployment.

In October, GM said it had lost roughly $1.9 billion on Cruise in the first nine months of 2023, including $732 million in just the third quarter. Since 2017, the company has lost more than $8 billion. GM originally believed that Cruise could generate $50 billion in revenue for the company by 2030, and it hasn’t backed down from that estimate in recent months.

GM announced in November that it plans to cut spending on Cruise by “hundreds of millions of dollars in 2024.” Cruise’s internal investigation of the Oct. 2 incident is expected to last until January 2024.

“As we look forward, the road to successful commercialization is dependent on defining and meeting an exceptional performance and heightened safety bar.  Cruise is committed to playing a key role in defining these standards with the input of our regulators, our communities and other AV industry leaders,” the company said in a statement.

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