Lyft Shuts Car Rental Unit, Cuts About 60 Jobs

Lyft has laid off about 60 people and announced it was ending its program that let people rent its cars on its app.

The Wall Street Journal reported Wednesday (July 20) that Lyft has been consolidating its global operations.

The 60 people are less than 2% of the staff, according to the report. The employees affected were from operations.

“Our road to scaling first party rentals is long and challenging with significant uncertainty,” according to the memo, sent by Cal Lankton, vice president of fleet and global operations at Lyft.

Per WSJ, Lankton said that there had been talk about dropping car rentals last fall. Those plans sped up “as the economy made the business case unworkable.”

The report says Lyft will work with the rental car companies, and the car rental business already had five locations. Lyft also had partnerships with Sixt and Hertz in over 30 locations. And a spokeswoman said the company will “continue to have national coverage and offer riders a more seamless booking experience.”

WSJ wrote that Lyft is also reorganizing its global operations team, and has consolidated from 13 to nine regions. It has also closed a location in northern California, and its Detroit hub.

The cuts come as economic challenges have been hobbling the sector. While the ridesharing industry was hiring rapidly for years, the money is drying up and shares are falling as pandemic trends and other issues like inflation keep piling up.

See also: Lyft, Hertz Team on New Summer Travel Offerings

On the subject of Lyft’s recent partnerships, Lyft’s work with Hertz was intended to ease the pressures of summer travel, PYMNTS wrote. The report says Lyft will offer Priority Pickup for customers in some markets who are heading to airports. It’s also now allowing shared trips for airport runs.