Autonomous truck tech company TuSimple plans to cut some of its workforce, possibly as early as this week, according to The Wall Street Journalwho quoted “people familiar with the matter.”
While the Journal reported that layoffs could affect at least half of TuSimple’s workforce, businessroundups.org’s own source familiar with the matter said that number isn’t accurate, but wouldn’t say more. It could be closer to 15%, according to online forums, some of which have speculated there’s a game of phone going on here (e.g. 15 sounds like 50).
Talks about layoffs at TuSimple have been going on for weeks, especially after the end of TuSimple’s deal with Navistar to co-develop purpose-built autonomous semi trucks. TuSimple has withdrawn offers it gave to interns to join the company, and posts on LinkedIn and called Blind”massive layoffs.”
While the number of employees to be laid off is still unknown — TuSimple currently has about 1,430 full-time employees worldwide — it’s not surprising to see yet another tech company downsizing due to macroeconomic headwinds and internal dramas.
TuSimple has undergone a number of executive shake-ups this year. CEO Cheng Lu, who was asked to step down from an advisory role in March, took over again last month. His predecessor and founder of TuSimple, Xiaodi Hou, was fired after an internal investigation found that certain employees had ties and shared confidential information with Hydron, a China-backed hydrogen transportation company. The company continues to face multiple federal investigations related to its relationship with Hydron.
TuSimple’s share price has also fallen sharply this year, down 95.63% from January, and the company has suffered a loss of investor confidence following the crash of one of its trucks in April. As a pioneering technology company, TuSimple has struggled to generate nearly enough revenue to cover its cash burn. In the third quarterTuSimple reported $113 million in losses on $2.7 million in revenue — revenue that came from moving freight for shippers in trucks with an operator behind the wheel.
“Like any technology and self-driving company, we carefully examine our spending and how to align it with our strategy,” Lu told businessroundups.org.
WSJ reported that TuSimple plans to scale back its work building self-driving systems and testing autonomous trucks on public roads in Arizona and Texas, a claim Lu denied to businessroundups.org. The teams involved in TuSimple’s operations in Tucson and its self-driving software algorithms would be cut as a result, the sources told the Journal.
Some of the upcoming layoffs could come from the teams responsible for building trucks together with Navistar. However, a source familiar with the matter told businessroundups.org that TuSimple plans to replace Navistar with a new OEM partner.
Sources told WSJ they expect the layoffs to begin Tuesday, and that TuSimple told employees’ offices would be closed Tuesday and Wednesday.
Canary in the coal mine
Interns whose offers to join the company were withdrawn, as well as current TuSimple employees, have reported layoffs at the company on LinkedIn and Blind.
“Impacted by today’s mass layoffs at TuSimple, my offer to return as a Research Engineer was withdrawn,” Posted a former intern earlier this month who worked at TuSimple from June to September.
In response to one ask on Blind by a person who recently interviewed at the company, a TuSimple employee commented on Dec. 5, “We are going through massive layoffs right now. The stock is at an all time low. No clear path to making money.” The same person also said that staff morale is “quite low”.
That sentiment is echoed by other comments on TuSimple’s Blind profile. The latest company review, dated December 6, is titled “never trust this company”. The employee, a software application engineer, said a pro of working for TuSimple is the company “provide”[s] you with a hallucination that [it] can succeed.” Cons were listed as toxic culture, terrible CEO, no profitable product and massive layoffs on the way.
While Blind posts are anonymous, the company told businessroundups.org that its community is made up of verified professionals. No one is allowed to post unless they have been verified as a current employee of a particular workplace using their work email address.