Cruise announces layoffs as GM acquires defunct robotaxi company

Defunct robotaxi company Cruise has begun to lay off employees today, sources tell The Verge. The layoffs come two months after General Motors said it would no longer fund Cruise, and would instead shift its spending toward advanced driver assist and personally owned autonomous vehicles.

Cruise held an all-hands meeting today, in which it announced that GM had acquired full control of the company. A spokesperson for Cruise said 40 percent of the workforce will be laid off.

Cruise employees have spent the last month in limbo, as senior leadership weighed plans on how to move forward. Last week, TechCrunch reported that Cruise began extending retention offers to some employees, most of whom are engineers. Those employees are expected to take jobs at GM, working on the automaker’s driver assist product, Super Cruise. The company’s board was expected to meet in early February to announce the status of the remaining workers, who are reported to number in the thousands.

GM CEO Mary Barra pulled the plug on Cruise in early December, arguing that a shared autonomous mobility service was never really in its “core business.” Cruise was too expensive and had too many regulatory hurdles to overcome to make it a viable revenue stream. Instead, GM would pivot to “privately owned” driverless cars.

And just last week, Barra told investors that GM expects to save $1 billion annually by shutting down the service. “GM has proposed a restructuring plan that will refocus our autonomous driving strategy on personal vehicles,” Barra said.

With additional reporting by Kylie Robison