Peter Schmidt, co-founder and COO of the Boston-based hybrid VTOL aircraft startup Transcend Air, says he heard from ex-Terrafugia employees and a Terrafugia supplier that “over 100 people were walked off [Terrafugia’s campus] and told there would be arrangements made so they could retrieve their stuff.”
Another source who has spoken with former employees says that Terrafugia employees received news of the layoffs last Wednesday or Thursday, likely timed in connection with the Chinese New Year and consistent with scheduled annual meetings at Zhejiang Geely.
Terrafugia General Manager Kevin Colburn declined to confirm or deny that there have been layoffs, saying in an email, “Terrafugia does not comment on business operations.”
A LinkedIn search turned up 10 former Terrafugia employees with employment end-dates of this month who list themselves as looking for work.
While most employees appear to have been laid off, a source says that some have been retained to finish an unspecified ongoing project and that upon completion of that project, some time around June, the Woburn headquarters will close.
It’s a sad turn for the company, which was founded in 2006 by a group of Massachusetts Institute of Technology graduates whose business plan to develop an airplane with folding wings that could be driven on roads was the runner-up for the 2006 MIT $100K Entrepreneurship Competition. CEO and founder Carl Dietrich, who departed Terrafugia in 2019, provided initial funding from an MIT student prize. Terrafugia raised $1.5 million in private equity financing in 2008 and over $5.5 million in subsequent rounds through 2012.
The Transition production prototype completed its first flight on March 23, 2012, by which time the company reached a high point of about 100 reservations for the flying car. Several years later, before its acquisition by Geely, Terrafugia offered full refunds to deposit holders. Some took the refunds but a number elected to stay in line for eventual sales of the vehicle. Zhejiang Geely, which also owns the carmakers Volvo, Lotus, Geely and Proton, acquired the startup in 2017, trebling its workforce.