About 550 employees at autonomous vehicle company Motional have been laid off, according to a WARN notice filing and information obtained from company sources.
Earlier this week, TechCrunch reported that Motional halting commercial operations And plans to launch robotaxi service with its next-generation Hyundai Ioniq 5 robotaxis by 2026 have been delayed as it undergoes restructuring. Now, we have more clarity on how deep the cuts are.
A Motional employee, who spoke to TechCrunch on condition of anonymity, said every team has been impacted with high-level departures, including the company’s chief operating officer, Abe Ghabra.
The technical program management team related to autonomy and cloud operations has been reduced from 44 to 19, the source said. The Milpitas office in Silicon Valley — which was home to a division of Motion’s compute design team — is also being closed, two sources confirmed. Sources also confirmed that the high-performance computing team has been ousted, including its director David Fermor. The Venice office in Los Angeles — which was a small operations and commercial hub for Uber Eats making deliveries — is also being closed, sources say.
TechCrunch has also learned that the team behind Motional’s remote vehicle assistance platform has been significantly cut. Employees working in test, product, security, cybersecurity, and legal teams were also affected. In a statement, the company said there have been staff reductions across all functions of the business.
According to it, about 145 of the laid-off employees came from Pittsburgh. a warning notice Filed this week with the Pennsylvania Department of Labor and Industries. Most of the employees in Pittsburgh worked on software, according to a source familiar with the matter. Motional was also testing in California, Nevada and Massachusetts, but WARN notices have not yet been filed in those states.
Autonomy and infrastructure software teams were largely unaffected, a source said. It appears Motional has been left with a scrap-tag group to help improve its core technology and business model, while retaining what limited capital it has left.
A source at Motion told TechCrunch that the company has a lot of improvements to make to its technology. Until this week, Motional was running Robotaxi ride in Las Vegas But uber And lift network and Delivery to Uber Eats customers In Santa Monica. At all times, a human safety operator was driving the car, as well as another specialist in the passenger seat to manually log any problems. Meanwhile, Motional’s main competition Waymo is offering fully autonomous rides surpriseSan Francisco and los angeles,
Motional did not comment on any specific details in this article, but offered the following statement: “We have updated our strategic plan to focus resources on the continued development and generalization of our core driverless technology, while the near-term There is no emphasis on commercial.” deployment and support activities. This updated strategy requires the streamlining of our teams, which will result in staff reductions across all functions of the business. We deeply appreciate the team members leaving Motion for their contributions to our goals.”
Big cuts are needed to survive
The Motional was originally the product of a $4 billion joint venture between Hyundai and automotive supplier Aptiv. The company’s future was thrown into doubt earlier this year when Aptiv announced plans reduce its ownership interest And stop allocating capital to the venture due to the high costs of commercializing the robotaxi business and the long path to profitability. Aptiv expects to reduce its equity interest in Motion from 50% to about 15% by March 31, leaving Hyundai with remaining control.
A week earlier, Hyundai made a $475 million investment in Motional and spent another $448 million to buy 11% of Aptiv’s common equity interest in the company. It is like this bridge loan Motional secured this in March as a stand-in for this other investment to buy sometime later. 5% off The number of employees a few weeks ago.
A source at Motion told TechCrunch that in August 2023, the company was already tracking to spend 7% more than its approved budget, so it’s possible that Hyundai’s saving grace could help keep the startup alive without significant cuts. Will not be enough.
An employee also said that Motional was paying only a partial bonus for performance through 2023 – a slide deck put the number at 28.5%.
The layoffs at Motion are indicative of a much larger problem in the autonomous vehicle industry, as fewer companies are able to spend billions of dollars on technology that isn’t ready for prime time and is far from breaking even.
More details on severance
A fired employee told TechCrunch that those affected will continue to receive pay checks for 10 weeks, with the last day being July 6. Instead of a lump sum payment, laid-off employees will be given what’s called “garden leave,” meaning they’ll be paid every two weeks like normal pay, according to an off-boarding slide deck seen by TechCrunch.
This may give Motional an opportunity to save some money on severance. Motional has asked employees to alert the company if they find a new job before July 6 “to avoid overlap in employment.”
Employees with vested equity in March 2024 will not be paid immediately as Motional is still waiting for its valuation to determine the new share price, according to Deck.
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