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Cruise CEO Dan Ammann Leaves GM’s Self-Driving Car Unit

Cruise CEO Dan Ammann Leaves GM’s Self-Driving Car Unit

Cruise LLC, the autonomous-vehicle startup majority owned by General Motors Co., said Chief Executive Officer Dan Ammann is leaving the company, just as it’s on the verge of starting a commercial service with self-driving cars. 

GM gave no reason for the departure of Ammann, who was president of the Detroit-based automaker before taking over the startup in 2019. GM’s stock extended declines, falling 2.7% to $56.80 in postmarket trading after slipping less than 1% during the regular session.

Amman is departing -- and apparently leaving behind a big potential payday -- right as the company prepares to receive licensing and approvals to operate a self-driving car service in San Francisco. Cruise last month applied for a permit from the California Public Utility Commission to be able to charge for rides in autonomous vehicles that have no safety driver. GM CEO Mary Barra is counting on the business for $50 billion in growth over the next six years.

On a conference call with Cruise employees Thursday, Barra thanked Ammann for his leadership, said the company’s mission is still to get the taxi business running, and told the staff that Cruise is a special company that needs a special leader, according to people who heard her presentation. 

Cruise founder Kyle Vogt, who is the business’s president and chief technical officer, will serve as interim CEO. In addition, Wesley Bush, the former chairman and CEO of Northrop Grumman Corp. and a GM board member, will join the Cruise board, GM said Thursday in a statement.

At its investor day in October, GM included Cruise’s growth plans as a key part of doubling the carmaker’s revenue to $280 billion by 2030. The automaker expects 40% margins on the business.

Ammann, 49, was a key player in GM’s acquisition of Cruise in 2016 and was named CEO of the unit as of Jan. 1, 2019. In 2019 GM gave Ammann $25.6 million in restricted stock units that pay out only in the event of a Cruise sale or IPO within 10 years. Cruise’s board also awarded Ammann 101,485 options to buy common shares in the company, which GM acquired to develop autonomous-driving technology.

When asked about a spinoff or initial public offering on the third-quarter earnings call, Barra replied that Cruise is well-funded and that having the company joined at the hip with GM was an advantage. She indicated that an IPO was a long-term consideration.

“The vertical integration with GM is a key differentiator, and I believe it’s one of the reasons Cruise is so well-positioned as the only person who’s got the permit in south -- in San Francisco to actually take the driver out of the vehicle,” she said. The board over time will look at “what best enhances the overall value creation and shareholder value for the GM shareholder.”

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