Autonomous vehicle firm, Aurora, reduces its workforce by 3%

Aurora Innovation, the self-driving truck technology company planning to initiate a business of autonomous trucks by 2024’s end, has reportedly laid off a significant number of employees this month, say sources close to the matter. The company, headquartered in Pittsburgh and operating facilities in California, Colorado, Texas, and Montana, confirmed approximately 3% of its staff was made redundant at the start of the year, subsequent to an organizational review.

As per the company’s data, Aurora had a workforce of roughly 1,800 employees at the close of 2023.

According to an emailed statement attributed to Aurora’s Senior Vice President of People Cristopher Barrett;

As we move toward commercial launch, we recently reviewed the entire organization to ensure we are working as effectively as possible and with the velocity required to achieve our ambitious goals. Through this process, a limited number of roles were eliminated which impacted 3 percent of our total workforce. During the recent market uncertainty, we have been incredibly thoughtful in our resourcing in order to minimize such actions. We are grateful for the contributions of these individuals and are supporting them through this transition.

Despite recent layoffs, Aurora Innovation is advancing with its plans to roll out a fleet of autonomous trucks capable of navigating US highways without a human driver. By the end of 2024, the company anticipates launching up to 20 Class 8 driverless trucks. Initially, these autonomous vehicles, devoid of human drivers, will transport cargo between Dallas and Houston, a route presently used for testing purposes.

The company is in collaboration with automotive supplier Continental on a project worth over $300 million to mass-produce commercial self-driving truck hardware. Aurora recently completed the project’s first phase, enabling Continental to develop prototypes before its planned production commencement in 2027.

The process of developing safe, roadworthy autonomous vehicle technology has proven costly, leading to the closure or acquisition of many startups. This trend of consolidation began in 2020 and continued due to economic challenges through 2023.

Founded in 2017 by ex-employees of Tesla, Uber, and Waymo, Aurora chose to go public as a strategy to raise necessary capital to commercialize this cutting-edge technology. After merging with a special purpose acquisition company initiated by LinkedIn co-founder and investor Reid Hoffman, Zynga founder Mark Pincus, and managing partner Michael Thompson, Aurora became a publicly-traded company in 2021.

Aurora Innovation has become one of the few surviving firms focused on launching self-driving large trucks. Other firms, such as Kodiak Robotics, Torc Robotics, and Sweden’s Einride, are also developing autonomous vehicles. However, the journey has not been easy on account of significant costs involved in hiring engineers to develop the technology and economic difficulties that have eroded capital reserves.

In 2022, a confidential memorandum from Aurora CEO and co-founder Chris Urmson to its board suggested various cost-cutting and revenue-generating strategies, including a recruitment freeze, spinning off assets, a minor capital increase, going private, and even considering a sale to major tech entities Apple and Microsoft.

Despite these challenges, Aurora reassured its investors that it had sufficient funds to sustain operations until mid-2024. While some cost-cutting measures were implemented, the company received substantial relief in July 2023 when it raised $820 million from a public offering and a simultaneous private sale of its stock.

At the time of the stock sale, Aurora claimed that the funds would support operations through its commercial launch anticipated at the end of 2024 and “well into 2025”. This financial solvency was reiterated in Aurora’s third-quarter 2023 earnings report, with the company forecasting that its total liquidity position of $1.5 billion would back its planned commercial rollout and fund activities into the second half of 2025.