Embark Trucks, the first autonomous trucking company to haul freight cross country under robot control, is laying off 70% of its workforce and may liquidate. The San Francisco-based company is struggling to survive, like many other transportation startups. Embark completed a cross-country run of an autonomous truck with a safety driver on board in 2018, making it the first among a growing field of autonomous trucking startups. However, the company is now facing financial difficulties and has announced the closure of its offices in Houston and Southern California.
In a filing with the Securities and Exchange Commission, Embark announced that it was laying off 230 employees by the end of the second quarter and is looking for a buyer. The company is exploring a range of potential strategic alternatives available, including alternative uses of the company's assets to commercialize its technology. Without additional sources of financing, potential dissolution and liquidation are possible.
Severance payments, employee benefits, equipment and related costs, and noncash expenses associated with the vesting of share-based awards will cost $7 million to $11 million, according to the SEC 8-K filing. The noncash expense from other share-based awards cannot presently be estimated.
Embark was founded in 2016 by entrepreneurs Alex Rodrigues and Brandon Moak, and it has been a pioneer in the field of autonomous trucking. However, the company's current financial struggles suggest that the road to success in this emerging industry is still fraught with challenges.
