VC Firms' Tech Stocks Fell 44%—After Buying Them Up In The Selloff Read More

TuSimple headquarters in San Diego. Photo by Bloomberg
autonomous vehicles

Makers of Self-Driving Trucks Face a Long Haul to Profitability

Photo: TuSimple headquarters in San Diego. Photo by Bloomberg

The frustrated co-founder of robotruck pioneer TuSimple demanded answers from his executives at a tense meeting in late January. The company, which went public last year and rode the global tech boom to a $15 billion market capitalization, was facing a relentless sell-off. It had hoped that its first driverless truck run, an 80-mile trip from Tucson, Ariz., to Phoenix in December—a project known internally as Ghost Rider, after a Marvel Comics superhero—would give its stock a much-needed boost. But it didn’t.

Co-founder Xiaodi Hou, an artificial intelligence expert with a doctorate in computation and neural systems from the California Institute of Technology, asked why TuSimple hadn’t done a better job of promoting its tech milestones, and blamed CEO Cheng Lu, a former private equity investor, according to two people with direct knowledge of the meeting. In early March, Lu resigned as CEO and Hou replaced him in an abrupt leadership change that triggered more selling of the company’s shares. So far this year, TuSimple shares are down 79%, giving it a market capitalization of $1.7 billion.

It’s unclear how much the January meeting contributed to Lu’s departure, and people who have worked with Hou and Lu say they also differed on how to develop TuSimple’s business.

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