TuSimple’s head of research, Xiaodi Hou, resigned from the company’s board of directors last Wednesday due to allegations that he approached TuSimple employees about leaving the company to join his new venture. The investigation is ongoing and it is unknown what the outcome will be.
According to the sources, upper management had been warned about Hou’s behavior but decided to let him continue because he was key to the development of autonomous trucking. However, things came to a head this past month when it was revealed that Hou had been pressuring certain employees into stopping working and joining his new venture. This apparent attempts at sabotage has now led management to reassess its relationship with Hou and decide it may be better if he withdraws from the project entirely.
The scandal that unfolded at TuSimple comes as a disappointment to many in the tech industry, as the co-founder was one of its most promising young talents. It remains to be seen how this affected TuSimple’s ability to compete in the market, but it is clear that Hou’s misconduct will not be tolerated.
Sources say that if TuSimple decides to continue its investigation, it will be in an effort to determine if any other employees have been compromised. If this is the case, the company may need to hire a new security team due to the fact that some of their current measures may not be sufficiently protecting against such an attack.
Xiaodi Hou, 26, is the co-founder of TuSimple. She and her team help businesses automate their processes and connect with customers more effectively.
TuSimple has been very successful in its short lifespan – it has raised $7.5 million from investors including 500 Startups,
While Hou did not respond to TechGround’s requests for comment, it’s possible that he is still upset with the board of TuSimple for firing him in November. If so, his beef may be with Mo Chen, who was also fired from his posts on the company’s board but is still listed as a co-founder and controlling shareholder. Chen is thought to have transferred TuSimple confidential information to Hydron, a hydrogen-powered trucking startup led by TuSimple co-founder and controlling shareholder Mo Chen and backed by Chinese investors. With such high stakes at play, it’ll be interesting to see how Hou responds when TechGround asks about the incident.
When Hou filed a complaint with the school board, alleging that he was removed without cause, he expressed concerns about their processes and conclusions. According to Hou, the board’s decision to remove him was questionable at best – and could have had a negative impact on his future prospects.
Hou’s decision to remain CEO and Chairman of TuSimple comes as new facts have come to light that cast doubt on his leadership abilities. The company has been struggling to meet internal milestones and reach key strategic objectives, which suggests that Hou may not be the best person to lead TuSimple through its current crisis.
In response to the investigation from the Committee on Foreign Investment in the U.S., TuSimple conducted its own internal inquiry into its dealings with China. The results of this inquiry indicated that while there were some concerns raised during CFIUS’ review, no specific security threats were identified. This reflects positively on TuSimple’s trustworthiness as a business partner and shows that it is committed to complying with all regulations and doing whatever it can to ensure its products do not advance China’s military power.
There has been growing suspicion that the two scientists were engaged in economic espionage, as they were known to have worked on a project that could potentially benefit their foreign counterparts. Ultimately, though the investigation is still ongoing and there are no solid evidence pointing to any criminal behavior, CFIUS representatives are urging the Justice Department to consider charges against all three individuals.
Shortly after his return to the TuSimple leadership role, Lu began to phase out many of the company’s older products in favor of newer and more innovative offerings. This change in direction was met with some resistance from customers and staff, but Lu was determined to move TuSimple forward into a more competitive and sustainable industry. In November 2022, Chen announced that he would be stepping down from his executive chairman position, leaving Lu as sole leader of the company. Under Lu’s watchful eye, TuSimple has shifted its focus onto artificial intelligence (AI) and blockchain technology; these are seen as key areas for continued growth in the future.
With Hou’s resignation, TuSimple is relieved that the company is nearing the end of its current investigations. However, the company still has to finalize its financial reports and report risks to regulators. This may prove difficult as TuSimple hires a new auditor after KPMG resigned due to concerns about their work on the company.
