With partners including UPS, the U.S. Postal Service and truckmaker Navistar, TuSimple had been running paid test loads on Interstate 10 since 2017 from its site on East Old Vail Road using autonomous trucks with human monitors aboard. In 2021 and 2022, the company conducted completely autonomous, "driver-out" test runs between Tucson and Phoenix.
In October 2022, San Diego-based TuSimple completed a major expansion of its research center and truck terminal on East Old Vail Road, from 6,800 to 50,000 square feet, and nearly doubled its local workforce to about 300 workers.
TuSimple signed a Primary Jobs Incentive agreement with the city and was reimbursed $110,247 for construction sales taxes it paid, based on its capital investment of $8.5 million and creation of 104 new jobs at an average annual salary of nearly $99,000.
But after an executive shakeup last fall and a subsequent decision to drop its nascent autonomous freight network, the company laid off most of its U.S. employees in Tucson, San Diego and Fort Worth, Texas.
In June, TuSimple announced it was exploring strategic options including a sale of its U.S. assets, as it shifted its business focus to Asia.
The city incentive agreement signed in February 2021 also required that TuSimple create 50 jobs at the new facility paying at least $54,932 annually and retain those jobs for five years, according to a Dec. 20 letter sent to TuSimple by Assistant City Attorney Regina Nassen.
The company was still in compliance during a site visit by city officials in September, with about 70 remaining workers, the city said.
But on Dec. 4, TuSimple Holdings said in a filing with the U.S. Securities and Exchange Commission that it planned to lay off about 150 or about 75% of its remaining U.S. workforce.
In early December, TuSimple also filed a notice with the state of Arizona under the federal Worker Adjustment and Retraining Notification Act, indicating plans to lay off 42 workers in Tucson, after laying off a total of 243 local workers in separate actions in late 2022 and May 2023.
Those latest job cuts put TuSimple into noncompliance with the terms of its agreement with the city, wrote Nassen, requesting full repayment of the incentive money.
TuSimple declined to comment beyond its public filings.
In an email reply to the city's letter provided by the city, TuSimple Deputy General Counsel Sierra Spitzer said she would "make sure this gets passed along for payment."
TuSimple Holdings' publicly traded stock has tanked to below $1 per share recently and the company posted a loss from operations, including restructuring costs, totaling nearly $249 million through the first three quarters of 2023.
The company, which raised about $1 billion in an initial public stock offering in 2021, still had about $777 million in cash, cash equivalents and short-term investments at the end of the September, according to SEC filings.
TuSimple faces several pending shareholder lawsuits alleging the company misled investors and may have improperly shared information with a Chinese hydrogen-truck startup linked to one of TuSimple's founders.
The company also has been subject of a probe by the Committee on Foreign Investment in the United States over improper sharing of autonomous vehicle technology that led to the removal of some of the company's Chinese board members under an agreement in 2022.
The company said it "anticipates that the remaining U.S. workforce will focus on winding down the company's U.S. operations, including through sales of U.S. assets, and assisting with the company's strategic shift to the Asia-Pacific region."
TuSimple, which was founded by a group of scientists and entrepreneurs originally from China, also has development operations in China and recently began testing self-driving trucks in Japan.
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