Just four months ago, Cruise had reason to celebrate.
California regulators had approved the self-driving car company’s request to provide around-the-clock fared passenger service in San Francisco, marking a major win for a company that had been operating under strict guidelines. The company had permission up until then to charge for driverless rides covering a small percentage of the city’s streets between 10 p.m. and 6 a.m.
Cruise was partly up against concerns over incidents where the driverless cars blocked traffic or halted emergency vehicles. San Francisco Fire Department Chief Jeanine Nicholson, for example, said during a hearing ahead of the August vote that she believed the emergency service disruptions could get worse if Cruise (and competitor Waymo) were allowed to expand their operations.
Still, the California Department of Motor Vehicles approved the expansion, and for a while operations continued on as normal—until an incident in October thrust the company’s safety into the spotlight. (A Cruise spokesperson didn’t respond to a request for comment by publication.)
Here’s what you need to know on how the GM-backed company went from taking over the winding streets of San Francisco to its “all time low,” as a leader reportedly described the current period to staff earlier this month.
A decade in the making
Cruise was founded a decade ago by Kyle Vogt, the Twitch cofounder who helped it become one of the leaders of the autonomous car movement. The company, which retrofitted cars with sensors at the time, sold to General Motors in 2016 as the AV war heated up. (Vogt served as Cruise’s president and chief technology officer after the sale. He took over as chief executive in 2021.) Cruise managed to rake in billions of dollars in funding as part of that transportation mania. But building successful AVs proved to be pricier and more time consuming than initially expected, so many of Cruise’s peers ended their self-driving goals in the coming years. Cruise, and Google’s Waymo, were among the last and best players standing.
Cruise conducted its first driverless ride in San Francisco in 2020 and allowed public riders to join the platform starting in 2022. As the company grew, more cars began to take over the San Francisco streets. Cruise officials said in August that the company operated about 300 vehicles at night and 100 during the day in San Francisco, according to the San Francisco Chronicle. But at the same time, city officials and pedestrians with cell phones were reporting repeated incidents where the vehicles would stop suddenly or obstruct emergency responses. Cruise in August said it would cut its fleet in the city by half while the DMV investigated recent crashes.
A “risk to public safety”
Cruise was able to keep operating though, up until its response to an October crash came into view. On October 2, a car hit a woman in San Francisco and flung her into the path of a Cruise driverless vehicle. The autonomous car hit the woman, stopped, and then dragged her roughly 20 feet as it pulled to the curb. The California Department of Motor Vehicles accused Cruise of leaving out the part about the woman being dragged from the video, which it initially shared. The agency on October 24 suspended Cruise’s permit to operate its self-driving cars in the state, citing “an unreasonable risk to public safety.”
Once the company was barred from operating for the time being in San Francisco, Cruise launched its mission to restore public trust. Cruise voluntarily pulled all its driverless operations across the country. The company said in a November 8 update that it hired a third-party law firm to review Cruise’s response to the incident, as well as an independent engineering firm to perform a technical root-cause analysis of the crash. Cruise also created a chief safety officer role and named Craig Glidden, GM’s executive VP of legal and policy, as chief administrative officer.
Executives fired, employees cut
The shake-ups continued well into the end of the year. Vogt and his cofounder, Dan Kan, both resigned on November 19. Cruise’s executive vice president of engineering, Mo Elshenawy, took over as president and chief technology officer. Cruise then fired nine key leaders on December 13 following its initial review, including COO Gil West and chief legal council Jeffrey Bleich. The company said in the internal messaging announcing the news that “new leadership is necessary.”
“Our integrity, our competency are being questioned, and this really hurts,” Elshenawy said at an all-staff meeting on December 5, according to Reuters. “We went from an all-time high to an all-time low and from being an industry leader to temporary pausing all of our operations.”
GM said it would cut costs at Cruise, leading to the company on December 14 cutting nearly a quarter of its workforce. The company laid off 900 of its 3,800 employees in addition to ending “additional assignments of contingent workers who support” the driverless operations. “This reflects our new future and a more deliberate go-to-market path, meaning less immediate need for field, commercial operations and corporate staffing,” the company said.
Cruise could also face $1.5 million in fines and additional sanctions. The company is ordered to appear at a February 6 hearing for “misleading the commission through omission regarding the extent and seriousness of the accident” and “making misleading public comments regarding its interactions with the commission.”
Just four months ago, Cruise had reason to celebrate.
California regulators had approved the self-driving car company’s request to provide around-the-clock fared passenger service in San Francisco, marking a major win for a company that had been operating under strict guidelines. The company had permission up until then to charge for driverless rides covering a small percentage of the city’s streets between 10 p.m. and 6 a.m.
Cruise was partly up against concerns over incidents where the driverless cars blocked traffic or halted emergency vehicles. San Francisco Fire Department Chief Jeanine Nicholson, for example, said during a hearing ahead of the August vote that she believed the emergency service disruptions could get worse if Cruise (and competitor Waymo) were allowed to expand their operations.
Still, the California Department of Motor Vehicles approved the expansion, and for a while operations continued on as normal—until an incident in October thrust the company’s safety into the spotlight. (A Cruise spokesperson didn’t respond to a request for comment by publication.)
Here’s what you need to know on how the GM-backed company went from taking over the winding streets of San Francisco to its “all time low,” as a leader reportedly described the current period to staff earlier this month.
A decade in the making
Cruise was founded a decade ago by Kyle Vogt, the Twitch cofounder who helped it become one of the leaders of the autonomous car movement. The company, which retrofitted cars with sensors at the time, sold to General Motors in 2016 as the AV war heated up. (Vogt served as Cruise’s president and chief technology officer after the sale. He took over as chief executive in 2021.) Cruise managed to rake in billions of dollars in funding as part of that transportation mania. But building successful AVs proved to be pricier and more time consuming than initially expected, so many of Cruise’s peers ended their self-driving goals in the coming years. Cruise, and Google’s Waymo, were among the last and best players standing.
Cruise conducted its first driverless ride in San Francisco in 2020 and allowed public riders to join the platform starting in 2022. As the company grew, more cars began to take over the San Francisco streets. Cruise officials said in August that the company operated about 300 vehicles at night and 100 during the day in San Francisco, according to the San Francisco Chronicle. But at the same time, city officials and pedestrians with cell phones were reporting repeated incidents where the vehicles would stop suddenly or obstruct emergency responses. Cruise in August said it would cut its fleet in the city by half while the DMV investigated recent crashes.
A “risk to public safety”
Cruise was able to keep operating though, up until its response to an October crash came into view. On October 2, a car hit a woman in San Francisco and flung her into the path of a Cruise driverless vehicle. The autonomous car hit the woman, stopped, and then dragged her roughly 20 feet as it pulled to the curb. The California Department of Motor Vehicles accused Cruise of leaving out the part about the woman being dragged from the video, which it initially shared. The agency on October 24 suspended Cruise’s permit to operate its self-driving cars in the state, citing “an unreasonable risk to public safety.”
Once the company was barred from operating for the time being in San Francisco, Cruise launched its mission to restore public trust. Cruise voluntarily pulled all its driverless operations across the country. The company said in a November 8 update that it hired a third-party law firm to review Cruise’s response to the incident, as well as an independent engineering firm to perform a technical root-cause analysis of the crash. Cruise also created a chief safety officer role and named Craig Glidden, GM’s executive VP of legal and policy, as chief administrative officer.
Executives fired, employees cut
The shake-ups continued well into the end of the year. Vogt and his cofounder, Dan Kan, both resigned on November 19. Cruise’s executive vice president of engineering, Mo Elshenawy, took over as president and chief technology officer. Cruise then fired nine key leaders on December 13 following its initial review, including COO Gil West and chief legal council Jeffrey Bleich. The company said in the internal messaging announcing the news that “new leadership is necessary.”
“Our integrity, our competency are being questioned, and this really hurts,” Elshenawy said at an all-staff meeting on December 5, according to Reuters. “We went from an all-time high to an all-time low and from being an industry leader to temporary pausing all of our operations.”
GM said it would cut costs at Cruise, leading to the company on December 14 cutting nearly a quarter of its workforce. The company laid off 900 of its 3,800 employees in addition to ending “additional assignments of contingent workers who support” the driverless operations. “This reflects our new future and a more deliberate go-to-market path, meaning less immediate need for field, commercial operations and corporate staffing,” the company said.
Cruise could also face $1.5 million in fines and additional sanctions. The company is ordered to appear at a February 6 hearing for “misleading the commission through omission regarding the extent and seriousness of the accident” and “making misleading public comments regarding its interactions with the commission.”