Ridesharing

Uber Refocuses Business, Cuts 3K Jobs

Uber

Uber plans to cut 3,000 more jobs and close 45 offices — all while eyeing other cutbacks as the COVID-19 economy keeps pummeling the ride-hailing giant. Job cuts do not include drivers, who technically are not employees.

Meanwhile, the company is seeking to buy Uber Eats rival Grubhub, which spurned the offer over the weekend. The talks between the two companies have so far not been fruitful.

As reported by The Wall Street Journal, CEO Dara Khosrowshahi announced the latest cutback plans in an email to staff today Monday (May 18). Uber’s rides business was down 80 percent in April from the same month the previous year.

Uber had already announced plans to lay off 3,700 people, as the coronavirus pandemic and stay-home mandates reduce the demand for rides.

In a regulatory filing, Uber said, “Due to lower trip volumes in its rides segment and the company’s current hiring freeze, the company is reducing its customer support and recruiting teams by approximately 3,700 full-time employee roles.”

The combined layoff decisions mean that Uber is shedding roughly a quarter of its workforce in under a month.

In the Monday email, Khosrowshahi said, “We’re seeing some signs of a recovery, but it comes off of a deep hole, with limited visibility as to its speed and shape.” He added that Uber Eats has been a bright spot during the crisis, but “the business today doesn’t come close to covering our expenses.”

A deal with Grubhub would help the enlarged food-delivery firm save money on the cost of building out delivery operations and make it more competitive with the larger DoorDash. Khosrowshahi did not raise the issue of negotiations in his email.

“I will not make any claims with absolute certainty regarding our future,” Khosrowshahi said. “I will tell you, however, that we are making really, really hard choices now, so that we can say our goodbyes, have as much clarity as we can, move forward, and start to build again with confidence.”

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