In a significant move highlighting the ongoing struggles in the automobile sector, Cars24, a leading online marketplace for used cars, has laid off approximately 200 employees across various departments. The layoffs come as the auto industry grapples with a prolonged downturn, impacted by declining profits at major companies like Maruti Suzuki and falling shares of auto giants such as Tata Motors due to looming tariff concerns. Cars24’s decision reflects a broader trend in the startup ecosystem, where cost-cutting measures have led many companies to trim their workforce to stay afloat during uncertain times.
Cars24, founded in 2015 by Vikram Chopra, Ruchit Agarwal, Gajendra Jangid, and Mehul Agarwal, confirmed the layoffs through an official blog post by Chopra. He mentioned that a company-wide restructuring had necessitated these tough decisions. Chopra explained that despite the company’s tradition of moving quickly and building ambitious projects, recent initiatives failed to deliver the expected results. Consequently, some roles, which were filled hastily, had to be reassessed and eliminated to maintain financial discipline and ensure the company's long-term growth and sustainability.
Also Read: 'Asked Me To Strip': Actress Navina Bole Accuses Sajid Khan Of Sexual Harassment
The laid-off employees are not being left unsupported. Cars24, which has received substantial funding from SoftBank, has announced that it is providing affected employees with severance packages and outplacement services to ease their transition. This gesture aims to soften the blow for those impacted by the layoffs. Notably, the layoffs at Cars24 are part of a larger trend where around 30 startups collectively laid off over 9,000 employees last year, with cost-cutting cited as the primary reason in nearly 60% of the cases, signaling a tightening environment across the startup ecosystem.
Earlier this year, Cars24 ventured into the new car sales market, diversifying beyond its core used-car operations. The company also recently acquired the domestic automotive forum Team-BHP, though an official announcement regarding the acquisition has yet to be made. Despite these expansion efforts, the company's leadership acknowledges the importance of recalibrating strategies when growth projects don't meet expectations. Vikram Chopra emphasized in his blog post that maintaining clarity and financial health is crucial, stating that "speed without clarity can be very costly," underscoring the need for tough but necessary decisions.