Cars24: Laying off 600 Employees – A Blow to the Transportation Industry
The recent announcement of layoffs by Cars24 has sent ripples of concern through the transportation industry. This Gurugram-based car buying and selling platform is backed by SoftBank and has raised $1,300mn in Series G funding. The company has been performing well on its mission to make the used car market digital, but the news of layoffs has come as a surprise to many.
Company Introduction and History
Cars24 was founded in 2015 by Vikram Chopra, Mehul Agrawal, Ruchit Agarwal and Gajendra Jangid. The platform offers end-to-end solutions for buying and selling used cars. The process is quick and hassle-free as customers can sell their cars within 30 minutes on the website. Cars24 has a presence in over 130 cities and has transacted over 2.4 million cars till date.
Funding and Investors
The company has been on a roll since its inception and has raised significant funding from various investors. The latest Series G funding of $1,300mn was led by SoftBank Vision Fund 2, along with participation from existing investors – DST Global, Falcon Edge Capital and Tencent. The funding has been earmarked to scale up operations, expand the team, and invest in technology.
Cars24 is a well-known name in the Indian used car market and has disrupted the conventional way of selling used cars. The company has shown impressive growth in its five years of existence, with a CAGR of 95% and a revenue of INR 13.6bn in FY2020. The company has built a strong customer base and has won the trust of customers by offering a transparent, convenient and seamless experience.
Layoffs and Reasons
The announcement of layoffs by Cars24 came as a surprise to many, given the company’s strong performance. As per reports, the company has laid off 600 employees, which is approximately 15% of its workforce. The layoffs have come as a result of a restructuring exercise in the company. The company has stated that the layoffs were necessary to streamline operations and improve efficiency amidst the pandemic-induced slowdown.
The news of layoffs has caused concern among employees, customers, and investors. Many employees have expressed their disappointment and concern for their future. However, the company has assured that it has offered adequate support to the affected employees by providing them with severance packages, counseling and job placements. The impact on the company’s performance remains to be seen, but the industry will be watching closely.