SoftBank-backed Ola lays off 1,400 employees due to coronavirus crisis

Ola’s taxi drivers talk to each other while waiting for passengers at the side of a road in Amritsar.

NARINDER NANU | AFP | Getty Images

The Indian rigging company Ola is laying off 1,400 employees to help it overcome the coronavirus crisis.

The company, which considers Uber SoftBank contributor as an investor, said revenue has plunged 95% in the past two months, as shelter measures on site have dampened demand for its taxi app.
Ola’s co-founder and CEO, Bhavish Aggarwal, described the downsizing as “the most difficult decision I have ever made”.

“I personally spent a lot of time reviewing and revisiting every aspect of this exercise, because each of the people involved played an important role in building Ola and is the most talented and passionate person I have met “, did he declare. said in an email to the staff Wednesday.

“These decisions do not reflect anyone’s performance and are purely a function of the uncontrollable circumstances we have faced.”

The reductions only affect Ola’s employees in India and will result in a reduction in its mobility, food delivery and financial services units. Aggarwal said there would be no more layoffs afterwards.

Ola’s human resources team will hold one-on-one conversations with affected employees, said Aggarwal. The company offers a range of benefits, including three months’ salary, stock options and insurance coverage.

“This crisis requires the need to keep an aggressive cash flow so that we can invest in opportunities in the future,” said the head of Ola.

“As we restructure our organization to reflect the new realities of our business, we will also commit to strengthening our operational excellence and leveraging many more technologies to improve efficiency and reduce costs in all parts of our business.” company.”

This occurs when other carpoolers have been forced to take deep cost reduction measures. Uber, Ola’s main competitor, recently announced 6,700 layoffs worldwide, while Lyft announced that it would lay off 982 workers.

Before the start of the pandemic, Ola had made a big international effort for its support service. The company was launched in London in February, with the aim of dethroning Uber as the market leader in the capital of the United Kingdom. With the coronavirus pandemic forcing many countries to suspend their economic activity, the impact has been strongly felt by start-ups in the mobility sector.

Ola has raised $ 3.8 billion to date from investors, including SoftBank, Tencent in China, and South Korean automakers Hyundai and Kia.

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