Tucson Reaches a Settlement with CFIUS

Tucson's three-year-long dispute finally comes to an end.

Tucson Future announced today that it has reached a settlement agreement with the Committee on Foreign Investment in the United States (CFIUS).

It is this agency that has been eyeing this leading autonomous driving company since its listing in 2021 and launched a long-term investigation, affecting everyone from investors to executives to the company's technical team. This is also the culprit behind Tucson's continuous turmoil after listing.

Now that both sides have reached a settlement, Tucson ushers in a new chapter. The end of the story of the world's first self-driving vehicle stock.

Tucson Reaches a Settlement

Just now, Tucson officially announced that it has reached a settlement with the CFIUS.

Tucson reached the settlement without admitting any fault, and all previous problems were resolved. The various speculations and investigations that started in 2021 have come to an end.

Because when Tucson just went public, the CFIUS started to pay extra attention to this world's first self-driving vehicle stock.

The members of this agency come from multiple US government agencies such as the State Department, the Department of Justice, the Department of Commerce, and the Department of Homeland Security. The most famous one before was seen in the case where TikTok was forced to be split and given to relevant parties in the United States.

And this time, the CFIUS also launched a detailed investigation inside and outside Tucson.

The initial investigation reason was because Tucson's largest shareholder is a company related to Sina with a Chinese background; later, the focus of the investigation was expanded to the data security issue involved when the Chinese and American technical teams communicated in technical terms; and there was also the lack of a security director in Tucson Future and a board of directors for government security committees.

A series of heavy pressures led to the departure of Chairman Chen Mo, and the co-founder Hou Xiaodi, in addition to serving as the CEO, also had to serve as the chairman, CEO, and president simultaneously. The company's board of directors was reorganized, and a security committee was also established.

I thought the investigation came to an end here. Even though a large number of MBA managers without technical backgrounds moved in after the board of directors was reorganized, at least Tucson could continue to develop.

But unexpectedly, after Chen Mo left and established the hydrogen fuel heavy truck company Hydron Turing Truck, Tucson was suspected of leaking core self-driving commercial secrets to Chen Mo. Tucson's board of directors directly removed CEO Hou Xiaodi, and the company was exposed to an external investigation again.

And Hou Xiaodi not only issued a long article accusing these baseless accusations, but also united with Chen Mo and re-hired President Lv Cheng. Using the majority voting rights, the board of directors was reorganized, and the power returned to the founding management team.

However, now that Tucson Future has reached a settlement with the CFIUS, these problems such as the lack of a security director or being accused of leaking secrets are no longer problems, and it is also in the case that Tucson does not have to admit fault.

The current president and CEO of Tucson Future, Lv Cheng, said that the company is very glad to be able to put these problems behind.

The CFIUS has ended the investigation. This resolution can help Tucson better focus on implementing the next stage of development. We will still be committed to closely cooperating with regulatory agencies and fully fulfilling our obligations to the CFIUS.

Tucson's interrupted delisting also has a chance to continue to advance.

Tucson's Future on Hold

The reason why it is said that after reaching a settlement, it is conducive to continuing to advance Tucson's interrupted delisting process.

It is because now all business activities including delisting have been interrupted, which is related to the suspicion that Tucson has an association with the new company established after Chen Mo's departure and is suspected of technology-related transfer and violation of national security agreements.

This incident not only eventually led to Hou Xiaodi's forced departure but also triggered a lawsuit. Two American shareholders of Tucson Future sued Tucson Future in court.

Although the plaintiff did not produce direct and conclusive evidence to prove that the company actually leaked trade secrets, the Southern California court still issued a temporary restraining order to Tucson Future, stating to prevent the possible further leakage of trade secrets.

Even though the restraining order has a term of 45 days, Tucson still decided to suspend all current business activities to ensure compliance with regulations, and the recovery time is unknown.

Now that the suspected source has disappeared, it may also be possible to put Tucson's business activities back on the agenda.

However, looking at Tucson's current situation, this interruption has already had an impact on the company.

Because Tucson's delisting in the US is one of the actions after the company's center shifts to Asia. It also laid off 75% of its staff in the US and made preparations for a full retreat.

At that time, the Tucson China side also came out to respond, promising that the development of China's business will not be affected by the US delisting.

But since January 30 this year, as soon as the restraining order was issued, all of Tucson's business activities have stopped, including the progress of research and development and business landing in China.

The Smart Car Reference learned that Tucson's R&D team in the US has almost been disbanded, and the Chinese team has basically scattered in all directions.

Among the most core talent changes is that the recent CTO of Tucson China, Wang Naiyan, was exposed to have joine d Xiaomi Automobile and report directly to Ye Hangjun, the chairman of the Xiaomi Technology Committee and the overall person in charge of Xiaomi Automobile's autonomous driving.

When he was in Tucson, he not only supervised the L4 algorithm team in China but also was in charge of the L2+/L3 smart truck business line. He is one of Tucson's core founding team members. And his departure will undoubtedly have a very big impact on Tucson Future with a focus on China.

Tucson probably still needs a longer time to restart the future. Or it needs to end the previous stage before starting a new journey - if there is a new journey.