New boss at SF’s Cruise mourns low morale while planning layoffs, report says

Cruise had an expensive but fairly successful operation going in San Francisco until October, when the General Motors-owned startup lost its state permits to run its driverless vehicles as paid taxis and to test them without human backup drivers. Now the company and its workforce are going through a royally embarrassing stretch — and the new boss knows it.

Cruise lost its permits after the California DMV alleged that Cruise hid evidence that one of its cars dragged a knocked-over pedestrian 20 feet in San Francisco before finally coming to a stop. In November, Cruise lost its CEO when co-founder Kyle Vogt resigned. 

In an all-staff meeting Tuesday, according to Reuters, new Cruise President Mo Elshenawy spoke plainly about the company’s fall from grace. “Our integrity, our competency are being questioned and this really hurts,” he said, according to a transcript reviewed by 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.”

Peter Finn, a leader of the Western Region of the International Brotherhood of Teamsters union, argued in a statement to SFGATE on Wednesday that Cruise should publicly release its findings from an internal investigation the company announced in November. The union pushed for regulation to require human drivers in autonomous trucks, but Gov. Gavin Newsom vetoed the proposed bill in September.

In November, Cruise cut the contracted staff who maintain its San Francisco fleet, company spokesperson Navideh Forghani told SFGATE at the time. TechCrunch reported that the company had suspended its program that allowed employees to cash out shares on Nov. 16. The company is now planning layoffs, according to Reuters. 

“This last week a Cruiser shared with me that they don’t wear their Cruise jacket in public anymore,” Elshenawy said in the Tuesday meeting, Reuters reported. “It truly breaks my heart.”

GM, which has poured billions of dollars into Cruise cars’ development, isn’t likely to give up on the startup, but the automotive giant announced on Nov. 29 that it would be spending “substantially” less on the division, per CNN. 

Cruise’s chief administrative officer, Craig Glidden, who came aboard in November from GM, told staff Tuesday he is focused on trying to fix relationships with regulators and build trust, according to Reuters. Glidden spoke optimistically, the outlet reported, but said, “We still have a ways to go.”

Hear of anything happening at Cruise or another tech company? Contact tech reporter Stephen Council securely at [email protected] or on Signal at 628-204-5452.