Tech layoffs are in full swing, with January marking the highest level of job cuts since 2009, driven mostly by AI restructuring. U.S. employers announced over 108,000 layoffs in January 2026, a 118% increase from January 2025, with most companies citing artificial intelligence as the main reason for the job cuts.
The automotive industry is not immune to this, although the main culprit is not AI but the EV downturn. Lucid Motors announced a 12% reduction of its global workforce last month and General Motors laid off over 1,100 workers at two major plants in January.
The Future of Hyundai's Supernal Looks Uncertain
Now, word got out that a Hyundai Motor Group-owned startup based out of California has laid off 80% of staff. Supernal, a flying EV company, revealed last week it was axing 296 jobs at facilities in Orange County and Fremont, and a testing site in Mojave.
The $1.7 billion startup said it would consolidate its operations to its Irvine headquarters; Supernal moved from Washington, D.C. to California in 2023. After the layoffs, the company is left with fewer than 80 employees.
"This decision is a strategic pivot to ensure our staffing and cost structures are optimized for the long-term delivery of our market-aligned aircraft design," a company spokesman told the Orange County Register. "Hyundai Motor Group remains committed to the Advanced Air Mobility business as part of its future mobility vision, and Supernal will continue to serve as the group's dedicated AAM execution arm for aircraft development," he added.
For now, the focus remains on stabilizing the company, shaping a new business model, and developing a commercially viable aircraft, the company representative noted. The most recent layoffs follow another round of cuts that took place last summer, when Supernal cut 10% of its workforce.
Development of Supernal's S-A2 eVTOL Aircraft Has Been Halted
Supernal has been struggling with test flights for its autonomous eVTOL (electric vertical takeoff and landing) aircraft in Mojave. The flying EV concept, dubbed S-A2 eVTOL, has been slow to demonstrate its autonomous flying tech, and Supernal paused its development in September 2025 to evaluate the next steps.
The eVTOL concept was designed to accommodate four passengers and a pilot over distances of up to 60 miles before a battery recharge was necessary.
Other eVTOL companies, including the advanced air mobility subsidiaries of Airbus and Textron, have either halted or canceled development efforts in recent months, citing technological and financial risks.
Meanwhile, electric air taxi companies like Joby Aviation, Vertical Aerospace and Archer Aviation have made significant progress in developing their own eVTOL aircrafts. For example, Joby Aviation and Uber plan to launch a commercial eVTOL air taxi service in Dubai in 2026, although the current political situation in the Middle East may throw a wrench in the works.
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