Lyft to cut 13 percent of workforce due to ‘slowing economy’

Mobility provider Lyft has announced plans to lay off 683 employees – 13 percent of its workforce.

In an email sent to workers and later shared on the firm’s website, Lyft’s CEO Logan Green and President John Zimmer said economic headwinds and increasing rideshare insurance costs have made the mass layoffs necessary.

“We are not immune to the realities of inflation and a slowing economy,” they said.

“We need 2023 to be a period where we can better execute without having to change plans in response to external events – and the tough reality is that today’s actions set us up to do that. It’s our responsibility to take ownership of these decisions and, in the end, protect the future we’re building for the drivers and riders we serve.”

Lyft’s share price has fallen by 75 percent over the past year, but the firm has not changed its financial guidance for the third quarter of 2022 or its 2024 financial targets.

Wider trend

Mobility firms have been heavily impacted since the pandemic, with many including Spin, Tier, Superpedestrian and Voi laying off staff or withdrawing from markets.

Last month, Bird announced it had decided “to fully exit three European countries – Germany, Sweden, and Norway – and to wind down operations in several dozen additional [countries]”, saying a lack of regulatory frameworks had resulted in an oversupply of vehicles, making it difficult to compete.

Autonomous vehicle startup Argo AI recently announced it was shutting down resulting in mass layoffs, but some employees are being absorbed into its two main backers, Ford and Volkswagen.

On Friday, Twitter sent shockwaves through the tech world when it fired almost half of its workforce.

Facebook’s parent company Meta is also expected to announce major cuts this week, according to the Wall Street Journal.

Image: Focal Project JP (Flickr)