Self-driving truck company TuSimple to lay off 25% of workforce

We knew it was going to happen. TuSimple plans to lay off 25% of its workforce as part of a broader restructuring plan.

The layoffs come a couple of weeks after the two companies ended their deal. A rough year for the company included a series of executive shakeups, a truck crash and a plunging stock price. TuSimple has been struggling to make enough money to cover its cash burn.

The current economic environment is not easy. Cheng Lu, TuSimple's president and CEO, said in a statement that they must be careful with their capital. Earlier this year, Lu was ousted as CEO. Xiaodi Hou, the founder of TuSimple, was fired after an internal probe showed that some of his employees had ties to Hydron.

I regret the impact this has on those affected, but I believe it's necessary as TuSimple continues its path to commercialization. TuSimple's overall strategy is to prioritize investments that bring the most value to shareholders and position the company as a customer-focused, product-driven organization.

TuSimple is in the process of selling off its Asia focused business so the layoffs are only affecting staff in the U.S. It is not known which teams were affected or if the layoffs will hit a specific region, although a deep perception engineer in Los Angeles has already posted about being cut. TuSimple said in a statement that 80% of the staff are in research and development and are responsible for working in hardware and software resilience, reliability, safety and information security.

TuSimple says it provides limited value to its ongoing technology development because it still relies on previous generations of software.

The company wants to work with shipping partners to commercialize its technology. Around 7,000 reservations were received for the trucks by TuSimple. TuSimple might have to shop around again if any of those partnerships are still around. TuSimple will find another truck-maker in the future, according to a source.

The restructure will cost TuSimple between $10 million and $11 million and will be paid in the first quarter of 2023. The layoffs and restructuring will save the company up to $65 million annually.

At the time of publishing, TuSimple was trading at $1.42, which is down nearly 6 percent today and nearly 100 percent year-to- date. TuSimple didn't reply in time.