Global Autonomous Trucking Company TuSimple Holdings Inc. is expected to lay off at least 700 employees next week, just before the Christmas holidays.
the San Diego-based technology company, which operates in Arizona, Texas and China, has approximately 1,430 full-time employees. TuSimple executives seek to roughly halve the size of their workforce as the company scales back efforts to build and test autonomous truck-driving systems, The Wall Street Journal reported Friday.
The layoffs would come at a tumultuous time for the company, which underwent a management change in October after reports emerged that the FBI, Securities and Exchange Commission (SEC) and Committee on Foreign Investment in the United States United (CFIUS) were each investigating TuSimple’s links. to the Chinese startup Hydron Inc.
The job cuts are expected to be announced on Tuesday. The Journal reported that TuSimple will “significantly” scale back its efforts to build self-driving systems and test self-driving trucks on public roads in Arizona and Texas. “As part of the downsizing, much of TuSimple’s operations in Tucson, Arizona, where it does much of its test driving, will be eliminated, and the team that works on the software’s algorithms from autonomous driving will be significantly reduced,” the report said.
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TuSimple will focus on improving a software product that matches self-driving trucks with shippers who have freight to haul, to deliver freight transportation at a lower cost than human-driven trucks, people have said. familiar with the company’s plans.
FOX Business contacted TuSimple for comment but did not receive a response.
The employees have been prepare for layoffs. TuSimple CEO Cheng Lu, who previously ran the company and returned in November, emailed staff earlier this month to say that management was reviewing “our personnel expenses, most of our cash burn,” the newspaper reported.
Lu told the Journal that he intends to “right the ship, and that includes making sure the business is capital efficient.”
“TuSimple is cutting costs and ambitions as it recovers from a series of crises this year, including the crash of one of its self-driving trucks in April, the loss of key business partnerships, two CEO changes, the falling stock price and concurrent government investigations,” the report said.
The company is losing money. TuSimple only recorded $4.9 million in revenue and $220.5 million in losses for the first half of 2022, according to the report. Its partnerships with other companies, including Navistar International Corp. and McLane Company Inc., also fell apart amid controversy.
“McLane is aware of recent management, operational and route changes at TuSimple and is in communication with their team. We are evaluating the business relationship with TuSimple and will determine the next course of action in due course,” said the McLane chief. administrative officer Larry Parsons told the Journal.
In October, TuSimple fired its CEO and co-founder, Xiaodi Hou, after an internal board investigation revealed that Hou had shared confidential information with Hydron, a Chinese trucking startup that primarily operates in China and is funded by Chinese investors. After his ousting, Hou recruited TuSimple co-founder and Hydron founder Mo Chen to retaliate on the board, firing them. Together, they brought Lu back to lead the company, the Journal reported.
The company is now working to comply with US regulators.