Lyft is getting ready to significantly reduce its workforce, laying off roughly 30% of its entire staff, its new CEO David Risher told its employees in a memo, just a week since he started his new stint in the Uber rival.
The new big boss of Lyft, Risher, aims to cut costs across the ride-hailing service to keep up with the lower fares of its closest rival foe, Uber. His first move to drop expenses is to let go of thousands of employees.
Lyft to Layoff 30% of Workforce, Affecting Thousands of Employees
According to Associated Press, the San Francisco-based ride-hailing platform had a recent leadership change. The former Amazon executive, Risher, has begun his top leadership role at Lyft. A few days after he sat on the throne of the chief executive, he quickly told employees that some of them were losing their jobs.
Risher reportedly emailed roughly 4,000 employees on Friday, informing them of a shocking downsizing in the ride-hailing service. The new CEO tells the workforce that the looming job cut affects a "significant" number of workers.
AP News notes that the email failed to provide specific numbers of employees who eventually lost their jobs. However, sources in the Wall Street Journal disclosed that the ride-hailing service plans to slash around 1,200 workers, which is around 30% of the company's entire workforce. The unnamed sources are reportedly close to plans for Lyft to trim down costs.
As per the San Francisco Gate, the upcoming round of layoffs at Lyft follows the job cuts late last year. The Uber rival previously fired around 683 employees last November 2022. With that, the looming downsizing remarkably affects more workers.
New CEO David Risher Plans to Lower Fares
Under the leadership of Risher, he wants to steer Lyft to be more competitive in pricing amid the low prices of Uber rides. He wants to drop the company's expenses to staggering amounts to make it possible.
In his recent email to employees, he explained the upcoming layoff, citing his goal to lower fares. The ex-Amazon exec wrote, "We need to reduce our costs to deliver affordable rides." On top of that, he says that this should also help raise the earnings of their drivers and, of course, to improve the profits.
The spokesperson of Lyft told CNN that "this is a hard decision and one we're not making lightly. But the result will be a far stronger, more competitive Lyft."
The co-founders of Lyft recently paved the way for its new CEO, Risher. John Zimmer and Logan Green, who has been with the Uber rival since day one, left their roles in the company as the leadership changed.
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