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Nuro plans for more layoffs as the AV sector’s economic woes deepen

Nuro plans for more layoffs as the AV sector’s economic woes deepen


The robot delivery company said it would pause production on its third-generation vehicle and scale back its commercial deployments.

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Nuro R2 delivery robot
Image: Nuro

Robot delivery startup Nuro announced plans to layoff a portion of its workforce and to pause its commercial operations as it pivots to more research and development. The news comes amid a broader set of financial challenges for the burgeoning autonomous vehicle sector.

Nuro grew too rapidly in recent years thanks to an abundance of capital, a zero interest rate environment, and a growing sense of competition. But the company has since run into economic headwinds that are challenging the entire tech industry.

Last November, Nuro laid off 20 percent of its staff, or about 300 employees. Additional layoffs will come later this week, Nuro said in a blog post — though it didn’t disclose how many workers would be affected.

“Last month, we offered voluntary separation packages to some employees, and we will implement a planned reduction in force later this week,” the blog post reads. “This change weighs on us most.”

“This change weighs on us most”

Nuro also said it would pause its commercial deployments and delay production of its third-generation version of its custom-built autonomous delivery vehicle, also known as the R3. It will also scale back its delivery pilots, which include partnerships with Domino’s Pizza and 7-Eleven.

“We have historically invested heavily in deploying commercial services and have learned a great deal from our customers,” the company wrote. “But commercial deployments come at a significant cost, both in terms of resources and autonomy focus. And until the unit economics of these services make sense, we think it is prudent to focus on what we can do efficiently as a startup.”

Nuro was founded in 2016 by Dave Ferguson and Jiajun Zhu, two veterans of the Google self-driving car project that would go on to become Waymo. It is one of the few companies operating fully driverless vehicles — that is, vehicles without safety drivers behind the wheel — on public roads today.

Nuro was also the first company to receive a special exemption from certain federal safety requirements and was also the first to charge money for its driverless deliveries in California. In 2021, Nuro raised $600 million in a Series D funding round, pushing the company’s valuation to $8.6 billion.