TuSimple Holdings Inc., a global self-driving trucking startup, is apparently planning to fire at least 700 workers. The layoff might happen in the next week, shortly before the Christmas break.
The IT business is headquartered in San Diego and operates in Arizona, Texas, and China. It employs around 1,430 people full-time. But, according to a Friday article in The Wall Street Journal, TuSimple leaders plan to reduce the team. They may lay off around half as the business dials back its attempts to develop and test autonomous truck-driving systems.
Workers have been getting ready for the massive layoffs
The company experienced a leadership change in October following news that the FBI, Securities and Exchange Commission (SEC), and Committee on Foreign Investment in the U.S. (CFIUS) were all looking into TuSimple’s connections to the Chinese start-up Hydron Inc. The layoffs would come at a trying time for the company.
Tuesday is when the layoffs are likely to be disclosed. TuSimple will reportedly “substantially” reduce its attempts to develop self-driving systems. Additionally it will test self-driving trucks on public highways in Arizona and Texas, according to The Journal. The team that develops the algorithms for the self-driving software will be drastically reduced as a result of the downsizing, according to the article, and a large portion of TuSimple’s business in Tucson, Arizona, where it conducts many of its test drives, will be terminated.
In order to provide freight transport at a cheaper cost than human-driven vehicles, TuSimple will turn its attention to enhancing a software solution that links shippers with freight to move with self-driving trucks. TuSimple was contacted for comment, but no answer was given.
Workers have been getting ready for layoffs. Cheng Lu, the former CEO of TuSimple who took over again in November. He informed colleagues earlier this month that management was looking into “our human expenditures, the main element of our cash burn.”
TuSimple only generated $4.8 million in sales
Lu wants ” to right the ship, and this includes ensuring the company is capital efficient.”
“TuSimple is cutting costs and scaling back its ambitions as it reels from a string of crises this year, including a crash of one of its self-driving trucks in April, the loss of key business partnerships, two CEO changes, a plummeting stock price, and concurrent government investigations,” the report said.
The business is in the red. According to the research, TuSimple only generated $4.9 million in sales and lost $220.5 million in the first half of 2022. Amid the issues, its alliances with other companies, including Navistar International Corp. and McLane Company Inc., have also disintegrated.
