Monarch Tractor prepares layoffs and warns employees it may ‘close’

Autonomous electric tractor startup Monarch Tractor warned employees on Thursday that it may need to lay off more than 100 employees, or perhaps even “shut down,” according to a company-wide memo obtained by TechCrunch.

The memo comes after Monarch Tractor has already cut some jobs over the past few weeks at the company’s facilities in California and remote teams in India and Singapore, according to several former employees who spoke with TechCrunch on the condition of anonymity.

Monarch Tractor was founded in 2018 by a team that included a former senior executive at Tesla’s first factory and Carlo Mondavi, scion of the famous winemaking family. The company has raised at least $220 million, including $133 million in 2024, as it pursues the goal of making “driver-optional” self-driving tractors that can perform tasks in places like wineries and other fruit farms.

While Monarch Tractor claims to have shipped about 500 of these tractors so far, the company Restructuring announced In late 2024, its tractors were supposed to see expansion into other use cases, such as pushing feed on dairy farms and maintaining golf courses. CEO Pravin Benmista also said at the time that Monarch Tractor would focus more on selling software services and licensing the company’s independent technology.

At least one customer — one of Monarch Tractors’ early dealers — claims the autonomous technology has never worked well, if at all. According to the lawsuit It was first reported by TechCrunch this week. A Burks Tractor dealer in Idaho claimed Monarch sold it “defective” vehicles that had “significant problems” after arriving in 2024. Primarily, Burks accused Monarch tractors of being “incapable of operating independently.” (Monarch denied the allegations in a lawsuit.)

Monarch Tractor suggests to employees in a memo issued Thursday that it is trying to move further away from tractor manufacturing — which may not be surprising, given that the startup lost its contract manufacturer, Foxconn, Earlier this year.

“The new business plan will enable Monarch customers to launch fully commercial software as a service (SaaS) and other direct-to-consumer software offerings, opening new revenue streams for OEMs,” the startup’s HR team wrote. “Unfortunately, the timing of completing the transition to the new business plan puts Monarch at risk of closure.”

Monarch told employees in the memo that it may permanently lay off up to 102 employees.

It’s unclear how many people currently work at Monarch. The startup had about 300 employees in late 2024 when Laying off more than 10% of the company As part of the restructuring. Former employees familiar with the recent cuts were unable to determine the exact extent of these layoffs. Penmesta did not immediately respond to a request for comment.

During this year, Monarch Tractor also lost some top talent, including Tesla co-founder Mark Schwager.

“We started Monarch with a bold vision: that agriculture could be electrified, automated, smarter, and more profitable — all at once,” Schwager wrote on LinkedIn. mail In July, while clarifying that he would remain on the company’s board of directors. “Monarch is fantastically positioned and in good hands for the next stage of its trajectory – making the timing right for this transition.”