Exclusive – GM Cruise CEO apologizes, will allow stock sale

Author: Greg Bensinger and Kim Hyun-joo

SAN FRANCISCO (Reuters) – The chief executive of General Motors Co’s robotaxi unit Cruise apologized on Saturday for a situation at the company after an accident halted its self-driving car operations while a safety review was conducted.

In an email to employees seen by Reuters, Cruise Chief Executive Kyle Vogt also said the company would make a new takeover offer that would allow employees to sell stock, just two days after the company A previous takeover bid was cancelled.

“I am sorry that we have veered off course under my leadership, which has had a profound and personal impact on many cruisers,” Vogt wrote in an email to employees.

“As CEO, I take responsibility for the situation Cruise is currently in. There are no excuses or whitewashing of what happened. We need to redouble our efforts on safety, transparency and community engagement.”

Vogt also noted that the way the company works with regulators, the media and the public “must improve.”

Cruise said Thursday that employees will not be able to sell shares in the buyback program this quarter because of an ongoing pay review.

But Vogt said in an email Saturday that certain employees can sell a limited number of shares at a time, citing employee concerns about tax obligations.

The privately held Cruise unit launched an equity plan in 2022 aimed at attracting and retaining talent, allowing current and former employees to sell their vested stakes to GM and other investors each quarter.

The suspension of the program sparked a backlash from some employees, who said they would face a heavy tax burden on shares awarded on Oct. 15 at a much higher valuation.

Canceling the program would help GM cut costs after having to suspend its cruise operations.

“We have heard your concerns and are developing a plan to conduct a new tender offer that will provide some RSU liquidity to mitigate potential tax liability,” Vogt said of the restricted stock units, a Equity compensation).

Vogt did not provide any details about the new offer.

“I’m glad they realize this needs to be addressed,” one frustrated employee told Reuters on Saturday.

A cruise line spokesman had no immediate comment Saturday.

In November, the California Department of Motor Vehicles (DMV) ordered Cruise to remove its self-driving cars from state roads, saying the vehicles posed a risk to the public and that the company had misrepresented the safety of its technology.

Regulators said Cruise initially did not disclose all video footage of an Oct. 2 incident involving another vehicle that ended with one of Cruise’s self-driving taxis dragging a pedestrian.

Cruise said it showed the full video of the crash to California DMV officials multiple times and provided officials with copies.

Cruise has suspended all robotaxi services in the United States, saying it needs to win back public trust through a comprehensive safety review of its vehicles and self-driving technology.

(Reporting by Greg Bensinger and Hyunjoo Jin in San Francisco; Additional reporting by David Shepardson in Washington; Editing by Cynthia Osterman and Tom Hogue)

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