Lyft is laying off about 1,000 employees as coronavirus wreaks havoc to the ride-hailing industry
Ride-hailing company Lyft is laying off about 17% of its total workforce due to coronavirus. In a filing with US Securities and Exchange Commission (SEC) on Wednesday, the Uber rival said that it planned to lay off “approximately 982 employees,” or 17% of its workforce. The company also revealed that it had furloughed 288 others as the coronavirus pandemic wreaks havoc on the ride-hailing industry.
The layoffs would cost the company between $28 million to $36 million in severance payments and other expenses. Lyft is not alone. Just yesterday, Tripadvisor announced that is laying off 900 employees, or one-quarter of its global workforce, as coronavirus continues to hammer the travel industry.
In total, the the job cuts and furloughs represent more than 20% of Lyft’s latest reported headcount of 5,683 employees at the end of 2019. In addition to the layoff, the company also said its executive leadership would take a 30% pay cut, with vice presidents seeing a 20% reduction and “all other exempt employees” taking a 10% cut. Members of Lyft’s board of directors “have voluntarily agreed to forego 30% of their cash compensation for the second quarter of 2020.”
“It is now clear that the COVID-19 crisis is going to have broad-reaching implications for the economy, which impacts our business,” he said. “We have therefore made the difficult decision to reduce the size of our team. Our guiding principle for decision-making right now is to ensure we emerge from the crisis in the strongest possible position to achieve the company’s mission.”
Founded in 2012 by John Zimmer and Logan Green, the San Francisco, California-based Lyft is a peer-to-peer transportation platform founded in 2012 to connect passengers who need rides with drivers willing to provide rides using their own personal vehicles. The company currently operates in 68 cities across the U.S.