TuSimple Co-Founder Pushes for Liquidation in Boardroom Battle Ahead of Shareholder Vote
The Escalating Conflict at TuSimple
TuSimple’s co-founder and former CEO Xiaodi Hou has intensified his campaign to reshape the autonomous trucking company’s future, just days before a pivotal shareholder meeting that will determine the composition of its board of directors.
Hou’s Aggressive Strategy
In recent weeks, Hou has taken dramatic steps including:
- Filing lawsuits to regain control of his voting rights
- Demanding immediate company liquidation
- Seeking court orders to block fund transfers to China
Now, Hou has announced plans to initiate a written consent process in early 2025 to replace current board members with directors who support liquidation. This move creates a potential end-run around Friday’s annual meeting outcomes.
The Board’s Countermove
TuSimple’s current leadership has proposed:
- Re-electing existing directors
- Implementing a staggered board structure
This second proposal would prevent future attempts to remove all board members simultaneously, effectively creating a defensive measure against Hou’s campaign.
The Legal and Financial Stakes
TuSimple CEO Cheng Lu responded to Hou’s actions with a statement alleging:
- Trade secret theft by Hou’s new venture, Bot Auto
- That liquidation would primarily benefit Hou by shielding him from litigation
- Shareholders would recover only a fraction of their investments
“The Company is focused on moving forward and does not believe liquidation will realize the most value to shareholders,” the statement emphasized.
TuSimple’s Troubled Trajectory
The current conflict represents the latest chapter in TuSimple’s turbulent journey:
- Went public in 2021
- Shut down U.S. operations in early 2024
- Delisted from Nasdaq
- Abandoned plans to relaunch AV testing in China
- Recently pivoted to AI animation and gaming
Hou contends that liquidation could return \(1.93 per share to stockholders, based on approximately \)450 million in remaining U.S. cash reserves. This contrasts sharply with the current $0.40 over-the-counter share price.
The Personal Stake
In his shareholder letter, Hou framed his campaign as a founder’s mission:
“I write to you today not just as an investor, but as a co-founder who has poured seven years of passion, energy, and personal commitment into making TuSimple a world leader in autonomous driving.”
He argues current leadership has abandoned TuSimple’s original vision and that liquidation represents the fairest outcome for all stakeholders.
The Ongoing Legal Dispute
Central to the conflict is a battle over Hou’s 27.9% stake:
- Hou claims a 2022 voting agreement granting control to co-founder Mo Chen has expired
- TuSimple maintains Hou must still vote as directed by Chen
This matter won’t be resolved until a scheduled Q1 2025 court hearing.
Historical Context
Hou’s relationship with TuSimple has been contentious since his 2022 ouster as CEO, which followed:
- Allegations of improper ties to Chinese startup Hydron
- Subsequent accusations of staff poaching for new ventures
- Resignation from the board in 2023
Hou maintains he was wrongfully terminated and resigned in protest of executive compensation during layoffs.
Article updated December 16 to include TuSimple’s official statement.
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