Carvana to Lay Off 12% of Its Workforce, Ignites 'Mass Hysteria'The automotive retailer Carvana Co. announced it will be laying off over 2,000 workers, about 12% of its workforce, in efforts to align expenses with sales.
Following a$506 million lossin the first quarter,Carvanais cutting back on expenses — starting with staff. The online automotive retailer, which sells and delivers used vehicles, will belaying off2,500 workers, and first shared the news in avague company-wide emailwarning workers of what was to come.
On Tuesday, the company sent an ominous morning email, stating there would be significant layoffs, but not indicating who would be affected. The email resulted in "mass hysteria at 7:30 a.m.," according to one worker who later found out she would be laid off — while on maternity leave.
The layoffs mostly targetedoperational positions, and told the majority of affected employees via Zoom, many of whom took tosocial mediato voice disappointment and concern. "You just fired us in a zoom meeting and said "have a good day' at the end. You should be ashamed," oneTweetshared. In light of the news, execs have decided toforego their salariesfor the remainder of the year to assist funding severance pay.
Related:CEO Lays off 900 Employees in Shocking Video Call
Carvanacited recent financial struggles for the decision totrim its workforce. "While Carvana is still growing, our growth is slower than what we originally prepared for in 2022, and we made the difficult decision to reduce the size of certain operations teams to better align with the current needs of the business," the companysaid.
It seemsCarvanaalready has a strong idea of what those needs are. On the same day of the layoffs, the company announced it would be spending$2.2 billionon various used-car auction sites from Kar Auction Services.
As of Tuesday, Carvanashares fell5.4%, and are down 84% for the year so far.
Related:This Program is Vital for Limiting Backlash When You Have to Lay People Off
