Weekly Brief: Tesla Sheds Autopilot Engineers as NHTSA Ramps Investigation

Tesla laid off nearly 200 workers last week and closed its office in San Mateo, California, where a dedicated team worked on Tesla’s advanced driver assistance system, Autopilot.

Most of the workers were data annotation experts who focused on labeling objects from captured video and feeding the information into Tesla’s artificial intelligence. Elon Musk has hailed data annotation as a critical role for realizing self-driving technology. “Without the auto labeling I think we would not be able to solve the self-driving problem,” Musk opined last year at the EV maker’s AI Day. Now, the data annotation office is closed and much of its workforce wiped out.

On the one hand, Tesla’s layoffs are not surprising. Musk has warned that he has a “superbad feeling” about the economy; him and pretty much everyone else right now, as runaway inflation meets supply chain woes, Covid closures and record gas prices. Tesla’s second quarter deliveries were down almost 20% from its previous quarter. The 254,695 vehicles figure was almost 50,000 short of Tesla’s target, in large part owing to factory closures in China because of the virus. Musk said he plans to cut 3.5% of his company’s salaried workforce and wants to put the kibosh on remote work. Tesla’s current headcount is roughly 110,000 employees. If 3.5% holds true, 200 workers is a drop in the bucket of the larger bloodshed that may soon follow.

On the other hand, it’s surprising that Tesla would lay off a vital component of its Autopilot team at a time when Autopilot is under investigation by the federal government for its failure to properly identify objects – the very focus of the team that has been laid off. The National Highway Traffic Safety Administration (NHTSA) has upgraded its preliminary investigation into Autopilot to an “engineering analysis”, which will delve deeper into why Autopilot has an alarming habit of guiding its vehicles into parked first responders like ambulances and fire trucks. Depending how the investigation shakes out, Tesla may be forced to do a mandatory Autopilot recall, in which case its shuttered office in San Mateo will be all the more sorely missed.

In other news last week, six robo-taxis in Cruise’s self-driving fleet got stuck at an intersection in San Francisco for two hours. The mishap played out at the corner of Gough and Fulton and didn’t conclude until a handful of Cruise employees showed up in person to manually push the cars out of the street. No paying customers were onboard at the time but they could have been. Cruise officially launched its robo-taxi service for paying customers six days before the mishap took place. Talk about a rough start to the commercial robo-taxi era in San Francisco. The California Public Utilities Commission is monitoring the situation to see if Cruise should be granted a license to charge for driverless rides between 6am and 10pm. Consider last week one strike against [Or at the robots going out in sympathy for the striking European unions over the cost-of-living crisis? – Ed].

Finally, Electrify America, the largest ultra-fast EV charging network in North America, raised $450M of equity investments. As part of the funding round, Volkswagen committed to increasing its capital investment in Electrify America beyond its original commitment of $2Bn through 2026. Electrify America plans to use the money to expand to 1,800 charging stations and more than 10,000 ultra-fast chargers in the US and Canada by 2026. More here.

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