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The landlord's house has no food left! Google Waymo rings the second round of "layoff bells."
The latest news, Google's parent company Alphabet's self-driving technology subsidiary Waymo has just laid off 137 employees, and most of the layoffs are concentrated in technical positions.
CNN reported that Waymo laid off employees
But this isn't the first layoff, and with its first round of layoffs in January, Waymo has laid off 209 jobs so far this year, or 8 percent of its workforce.
More than half of these laid-off employees are highly sought-after engineers in the industry, which shows that Waymo is indeed experiencing some problems at present.
Behind the successive layoffs is the fact that net profit has plunged one after another, and Waymo's profitability is getting tighter. At the same time, the autonomous driving industry is also affected by many problems, L4 commercialization is difficult, and some companies such as Argo AI supported by Ford Volkswagen have even collapsed.
Many companies in the L4 field are working in the L2 field, and Ford also established a company specializing in L2 today, and the overall L4 track is currently at a low point.
So, what happened to Google's Waymo layoffs this year? What is the current state of development?
First, 8% of employees lost their jobs, most of them engineers
In the second round of layoffs, what is unexpected is that Waymo's layoffs are not aimed at some positions of insufficient importance, but at engineers at the top of Google's organizational pyramid.
In response, Waymo responded in a statement to CNN that the layoffs were mainly due to the company's "fiscal system" considerations, "We have taken a deliberate approach and are confident that this transition will help each of these former teammates." ”
The translation is that Waymo was short of money when developing self-driving technology, so it controlled costs through layoffs.
Looking back at the first round of layoffs in late January, the size of the layoffs was about 100, involving 4% of Waymo's total headcount, ranging from perception and motion control engineers, fleet and vehicle technicians, and even recruiters.
▲In late January, a number of employees posted on overseas social media to discuss layoffs
Comparing the two rounds of layoffs, it can be seen that Waymo's layoff butcher knife is more inclined to technical positions. The first layoffs nearly shut down the trucking business, and this time with engineers, Waymo appears to have retained only its core driverless taxi team.
Within Waymo, self-driving engineers' jobs are becoming increasingly unstable.
Second, commercialization is difficult and actively shrinks
Why is Waymo always mired in layoffs?
The most direct reason is that it is difficult to balance income and expenditure and cannot make a profit.
According to the fourth quarter of fiscal 2022 financial report released by Google's parent company Alphabet in February this year, Alphabet's total revenue in the fourth quarter was 76.048 billion US dollars (about 524.997 billion yuan), although the total revenue increased by 1% year-on-year, but the net profit in the fourth quarter was 13.624 billion US dollars (about 94.053 billion yuan), down 34% year-on-year, and has fallen in profit for the third consecutive quarter.
It is worth noting that Alphabet's net profit in the second quarter of 2022 fell by 14% year-on-year, and the net profit in the third quarter fell by 26.5% year-on-year, which shows that Alphabet's net profit growth rate has declined and accelerated.
Even though Alphabet cut costs by cutting costs by laying off about 12,000 employees in January 2023 in order to save profits, it also incurred about US$1.9 billion to US$2.3 billion (about RMB13.1 billion to RMB15.9 billion) in employee severance pay and related expenses.
The businesses that have been most affected by Alphabet's losses are Google cloud computing and other businesses, and Waymo is precisely one of them.
Waymo, with 2,500 employees, is the largest of Alphabet's subsidiaries, but the revenue generated by this division barely covers its huge losses, and the company is simultaneously deploying the development of lidar hardware, building machine learning models, analyzing vehicle data and other businesses, all of which are very expensive.
Waymo's revenue source is primarily its driverless taxi business in California and Arizona. Last November, Waymo began charging for driverless taxis in San Francisco and Phoenix. On the other hand, Waymo's partnerships with trucking companies such as CH Robinson, JB Hunt and Uber Freight may also generate some revenue.
Waymo self-driving taxis (first left, second left) and Waymo Via autonomous heavy duty truck (first from right)
Although Waymo has not released relevant financial information, it can be seen from the sharp decline in Alphabet's net profit quarter by quarter that Waymo is facing a great problem of difficult balance and profitability.
The difficulty of commercial revenue is a common problem for current L4 autonomous driving companies.
In addition to the difficulty of profitability, safety issues have also become a pain point in the development of the autonomous driving industry.
Huge cost investment, tight profitability, and difficulty in commercialization have all led to the overall contraction of the foreign autonomous driving industry.
3. Established 14 years Focus on L4 field
Waymo started as an autonomous vehicle initiative that began in January 2009. In December 2016, Waymo spun off from Google and became a subsidiary of Alphabet.
In December 2018, the company launched its Waymo One app for self-driving ride-hailing.
The Waymo One app
In November 2022, Waymo received a license from the California Department of Motor Vehicles to deploy driverless cars, and Waymo can offer paid robotaxi services in San Francisco. Waymo then expanded the service to downtown Phoenix City.
Recently, according to TechCrunch, Waymo announced that it will begin testing robotaxi tests in Los Angeles in the coming weeks, which means that in a few weeks, Los Angeles residents can experience a truly driverless taxi service without a safety officer.
Conclusion: The autonomous driving industry is cold
Even in 2023, the cold wind of the autonomous driving industry is still cold. How to achieve self-hematopoiesis, create more profits, and achieve commercialization has become a "headache" for global L4 autonomous driving companies.
Waymo controls expenses and cuts costs through significant layoffs, in fact, the overall treatment of the symptoms is not the root cause, after all, the entire autonomous driving industry, especially the L4 autonomous driving field, has shown a contraction trend.
In this case, the current domestic L4 autonomous driving companies provide excellent reference examples, such as Baidu has iterated the L2 solution many times and launched ANP 3.0, which will achieve mass production in the middle of this year; Three years ago, Hongjing Intelligent Driving was reduced from L4 to L2 and L2+ mass production tracks, and obtained 20+ model designations.
For overseas autonomous driving companies, if they want to survive, they must think clearly about whether to stick to L4 or choose L2 volume, and self-hematopoiesis cannot be just an empty phrase.