Cruise CEO Kyle Vogt resigns from GM-owned robotaxi unit
Cruise founder and CEO Kyle Vogt has resigned from his role at the autonomous vehicle venture owned by General Motors, according to a company statement sent to CNBC on Sunday.
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Cruise CEO and co-founder Kyle Vogt has resigned from his role at the autonomous vehicle venture owned by General Motors, according to a company statement sent to CNBC on Sunday.
Mo Elshenawy, who previously served as executive vice president of engineering at Cruise, will now serve as president and CTO for Cruise, the company said.
Vogt confirmed his resignation Sunday night in a social media post on X, formerly known as Twitter. He did not give a reason for the resignation, and said he plans “to spend time with my family and explore some new ideas.”
The departing CEO also offered words of encouragement, writing: “Cruise is still just getting started, and I believe it has a great future ahead. The folks at Cruise are brilliant, driven, and resilient. They’re executing on a solid, multi-year roadmap and an exciting product vision. I’m thrilled to see what Cruise has in store next!”
Vogt’s resignation follows a string of missteps by Cruise.
As CNBC previously reported, the company issued a voluntary recall affecting 950 of its robotaxis, and suspended all vehicle operations on public roads following a series of incidents that sparked criticism from first responders, labor activists and local elected officials, especially in San Francisco.
In one serious incident in October, the human driver of another vehicle struck a pedestrian in San Francisco at night, tossing her into the path of a Cruise self-driving car, which then drove over and dragged her.
The California Department of Motor Vehicles suspended Cruise’s deployment and testing permits for its autonomous vehicles after that incident. “When there is an unreasonable risk to public safety, the DMV can immediately suspend or revoke permits,” the regulators said in a statement at the time.
In orders of suspension the California DMV issued to Cruise, the regulators accused the company of failing to give a transparent account of what happened during the pedestrian collision.
Separately, the National Highway Traffic Safety Administration is investigating Cruise to determine whether its automated driving systems “exercised appropriate caution around pedestrians in the roadway,” according to a filing on the agency’s website.
GM purchased Cruise in 2016. It then brought on investors such as Honda Motor, Softbank Vision Fund and, more recently, Walmart and Microsoft. However, last year, GM acquired SoftBank’s equity ownership stake for $2.1 billion.
GM execs, including CEO and Chair Mary Barra, had hoped the startup would be ramping up a driverless transportation network this year, and hoped Cruise would play a notable role in doubling the company’s revenue by 2030.
In October 2021, GM said it expected “new businesses” such as Cruise and its BrightDrop commercial EV business to grow from $2 billion to $80 billion during that timeframe.
According to its most recent quarterly update, GM has lost roughly $1.9 billion on Cruise between January and September 2023, including $732 million in the third quarter alone.
Barra also serves as chair of the Cruise board of directors. Former Tesla and Lyft executive Jon McNeill, a member of GM’s board of directors since 2022, was appointed vice chairman of the self-driving unit’s board following Vogt’s resignation.
Alex Roy from transportation consultancy Johnson & Roy told CNBC, “Responsibility starts at the top. If Cruise is going to survive, and they have great technology there, the CEO had to go.”
“I suspect at least one more high level exec will have to resign — anyone who made the call to obfuscate or omit information in communication with the California DMV,” he said. “In my opinion, Cruise has been too slow in taking steps to rebuild trust with staff, regulators and the public. Executive departures are table stakes.”
Vogt’s resignation comes roughly two years after he was reappointed as CEO, following an unexpected departure by Dan Ammann, a former GM executive, in December 2021.
Ammann, a former investment banker, began leading Cruise in 2019 after serving as GM’s president and chief financial officer before that. He was credited with the 2016 acquisition of Cruise.
Technology
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Chinese bargain retailer Temu changed its business model in the U.S. as the Trump administration’s new rules on low-value shipments took effect Friday.
In recent days, Temu has abruptly shifted its website and app to only display listings for products shipped from U.S.-based warehouses. Items shipped directly from China, which previously blanketed the site, are now labeled as out of stock.
Temu made a name for itself in the U.S. as a destination for ultra-discounted items shipped direct from China, such as $5 sneakers and $1.50 garlic presses. It’s been able to keep prices low because of the so-called de minimis rule, which has allowed items worth $800 or less to enter the country duty-free since 2016.
The loophole expired Friday at 12:01 a.m. EDT as a result of an executive order signed by President Donald Trump in April. Trump briefly suspended the de minimis rule in February before reinstating the provision days later as customs officials struggled to process and collect tariffs on a mountain of low-value packages.
The end of de minimis, as well as Trump’s new 145% tariffs on China, has forced Temu to raise prices, suspend its aggressive online advertising push and now alter the selection of goods available to American shoppers to circumvent higher levies.
A Temu spokesperson confirmed to CNBC that all sales in the U.S. are now handled by local sellers and said they are fulfilled “from within the country.” Temu said pricing for U.S. shoppers “remains unchanged.”
“Temu has been actively recruiting U.S. sellers to join the platform,” the spokesperson said. “The move is designed to help local merchants reach more customers and grow their businesses.”
Before the change, shoppers who attempted to purchase Temu products shipped from China were confronted with “import charges” of between 130% and 150%. The fees often cost more than the individual item and more than doubled the price of many orders.
Temu advertises that local products have “no import charges” and “no extra charges upon delivery.”
The company, which is owned by Chinese e-commerce giant PDD Holdings, has gradually built up its inventory in the U.S. over the past year in anticipation of escalating trade tensions and the removal of de minimis.
Shein, which has also benefited from the loophole, moved to raise prices last week. The fast-fashion retailer added a banner at checkout that says, “Tariffs are included in the price you pay. You’ll never have to pay extra at delivery.”
Many third-party sellers on Amazon rely on Chinese manufacturers to source or assemble their products. The company’s Temu competitor, called Amazon Haul, has relied on de minimis to ship products priced at $20 or less directly from China to the U.S.
Amazon said Tuesday following a dustup with the White House that had it considered showing tariff-related costs on Haul products ahead of the de minimis cutoff but that it has since scrapped those plans.
Prior to Trump’s second term in office, the Biden administration had also looked to curtail the provision. Critics of the de minimis provision argue that it harms American businesses and that it facilitates shipments of fentanyl and other illicit substances because, they say, the packages are less likely to be inspected by customs agents.
— CNBC’s Gabrielle Fonrouge contributed to this report.
WATCH: Trump tariffs mean higher prices, big losses for Amazon sellers
Jeff Bezos, founder and executive chairman of Amazon and owner of The Washington Post, takes the stage during The New York Times’ annual DealBook Summit, at Jazz at Lincoln Center in New York City, Dec. 4, 2024.
Michael M. Santiago | Getty Images
Amazon founder Jeff Bezos plans to sell up to 25 million shares in the company over the next year, according to a financial filing on Friday.
Bezos, who stepped down as CEO in 2021 but remains Amazon’s top shareholder, is selling the shares as part of a trading plan adopted on March 4, the filing states. The stake would be worth about $4.8 billion at the current price.
The disclosure follows Amazon’s first-quarter earnings report late Thursday. While profit and revenue topped estimates, the company’s forecast for operating income in the current quarter came in below Wall Street’s expectations.
The results show that Amazon is bracing for uncertainty related to President Donald Trump’s sweeping new tariffs. The company landed in the crosshairs of the White House this week over a report that Amazon planned to show shoppers the cost of the tariffs. Trump personally called Bezos to complain, and Amazon clarified that no such change was coming.
Bezos previously offloaded about $13.5 billion worth of Amazon shares last year, marking his first sale of company stock since 2021.
Since handing over the Amazon CEO role to Andy Jassy, Bezos has spent more of his time on his space exploration company, Blue Origin, and his $10 billion climate and biodiversity fund. He’s used Amazon share sales to help fund Blue Origin, as well as the Day One Fund, which he launched in September 2018 to provide education in low-income communities and combat homelessness.
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