SINGAPORE (June 16): Ride-hailing giant Grab will be laying off 360 employees today, or about 5% of its workforce, as the company scrambles to “become leaner as an organization” amid the Covid-19 pandemic.
In a letter to employees on Tuesday morning, Grab CEO Anthony Tan said that it has become clear that the pandemic will likely result in a prolonged recession, and Grab has to brace for what may be a long recovery period.
“Please know that we did not come to this decision lightly. We tried everything possible to avoid this but had to accept that the difficult cuts we are making today are required, because millions depend on us for a living in this new normal,” said Tan in the note.
“I assure you that this will be the last organization-wide layoff this year and I am confident as we execute against our refreshed plans to meet our targets, we will not have to go through this painful exercise again in the foreseeable future,” added Tan.
Over the past few months, Tan said that the company had reviewed all costs, cut back on discretionary spending and implemented pay cuts for senior management.
However, all these steps proved to be insufficient against the “stark impact” of the pandemic on its business.
Apart from the layoffs, Grab will also shift its focus to sunsetting some non-core projects, consolidating functions for greater efficiency, and right-sizing teams to better match its changing business needs given the external environment.
To be sure, Grab will also be doubling-down on delivery verticals, and has redeployed its employees to meet the increased customer demand for deliveries. According to Tan, the company was able to save “many jobs” during the redeployment which had helped limit the scope of the reduction exercise to just under 5%.
Despite the gloomy outlook that comes with the retrenchments, Grab’s board of directors and leaders continue to be bullish on the company’s business outlook.
“We will focus on adapting our core verticals such as ride-hailing, deliveries, payments and financial services to address the challenges and opportunities of the new normal,” said Tan.
“At the same time, we will expand support for small businesses by enriching our merchant service offerings. We believe these steps will steady us on the path towards sustainability,” he adds.
The affected employees will receive “financial, professional, medical and emotional support” through a slew of initiatives such as a severance package of half a month for every 6 months of completed service, medical insurance coverage till the end of the year and career transition and development support.
“In our eight years, we have faced numerous challenges, and we have always been able to survive – and thrive – because our commitment to our customers in Southeast Asia is unwavering,” said Tan.
“We are deeply rooted here and we continue to stay true to our mission of driving Southeast Asia forward,” he added.
