TuSimple, a company that once led the self-driving truck industry, is now attempting to shift its assets to China to fund a new business in AI-generated animation and video games. This decision has puzzled and angered several shareholders, and threatens to plunge the company into a legal morass.
A group of shareholders sent a letter to the company’s board, alleging “potentially fraudulent activities” and accusing Mo Chen, the co-founder and chairman, of misappropriating funds to support his private ventures. The letter also complained that the company failed to disclose its pursuit of AI animation and gaming.
TuSimple has around $450 million in cash, mostly in the United States, but the company is trying to move the funds to China. However, a temporary restraining order issued by a California district court is blocking the company from transferring assets outside the US, except for transfers related to its business operations.
Concerned shareholders question whether the company’s management is capable of generating value for them and argue that the company should use its assets to liquidate and redistribute wealth back to shareholders.
If TuSimple is unable to transfer its funds to China, the company may be further delayed in developing its animation and gaming business. However, the clock is ticking, as TuSimple is still registered with the SEC and as soon as the funds leave the US, shareholders will have no recourse to recover their original investment.
The dispute surrounding TuSimple’s assets comes as foreign direct investment into China has seen 12-month lows, and Chinese VCs with US money have left the country amid geopolitical tensions.
