Cruise suffers downfall, sees layoffs amid mounting safety issues

More than 900 workers at Cruise were notified by email Thursday that they had been let go. The layoffs come after months of safety issues plaguing the autonomous vehicle company owned by General Motors.

SAN FRANCISCO - More than 900 workers at Cruise were notified by email Thursday that they had been let go. The layoffs come after months of safety issues plaguing the autonomous vehicle company owned by General Motors.

Tech expert and San Jose State University professor Ahmed Banafa said a lack of transparency and regulations led to Cruise’s quick downfall.

"If you look at a company like Google with Waymo, compared to GM with Cruise, it's like the turtle and the rabbit race," Banafa said. "Cruise went so fast without thinking about the consequences."

In a statement to KTVU, a Cruise spokeswoman said:

"We shared the difficult news that we are reducing our workforce… primarily in commercial operations and related corporate functions. These changes reflect our decision to focus on more deliberate commercialization plans with safety as our north star."

The turning point came in October. A woman walking in San Francisco was hit by a car, thrown into the path of a Cruise car, and dragged 20 feet. In response, the California Public Utilities Commission and California DMV suspended the company’s robotaxi permits. Two days later, Cruise paused all driverless operations across the U.S.

Cruise co-founder and CEO Kyle Vogt resigned in November. On Wednesday, nine cruise executives were fired amid the investigation into the San Francisco accident.

"GM is the one calling the shots, making these kinds of decisions because they spent $8 billion on the company since 2017, $2 billion just this year," Banafa said.

Outside CPUC headquarters Thursday, members of labor groups called for the removal of CPUC Commissioner and former Cruise attorney John Reynolds.

Protestors said Reynolds shouldn't have been a part of the decision to let Cruise autonomous cars operate in the city. Neither the CPUC nor Reynolds have commented.

"Cruise will be back, simple and slow," Banafa said. "Driverless autonomous cars are here to stay. The technology is there. We have to make sure safety is number one."

The layoffs reportedly make up roughly a quarter of employees at Cruise. Employees will be paid through Feb. 12.