Getaround Lays Off 10% of Staff in Shift to Car-Sharing Business Model

On Thursday, peer-to-peer car sharing company Getaround announced that it was slashing 10% of its staff, marking the beginning of a restructuring aimed at putting the company on the path to sustainable profitability and long term growth. In recent years, Getaround has seen popularity increase as more people have realized how convenient and affordable car sharing could be. However, with increased competition from established companies such as Uber and Lyft, Getaround is tasked with proving its sustainability in an industry where adopters are fickle.

It has been reported that Getaround, a ridesharing app with offices in San Francisco and New York City, is laying off around 42 employees. This news comes just two months after the company announced it was cutting 150 jobs. In January, Getaround said it would be hiring 10 people in engineering and product. With these latest layoffs, this raises the question of whether or not the engineering position is still necessary given that the app has seen consistent reductions in user numbers over recent months.

Getaround revealed that it will be delisting from the New York Stock Exchange, due to its stock price falling below $0.50 per share. Following the news, shares of Getaround spiked 17% after hours, but have since settled to around $0.65. This increase is still impressive given that the stock was trading below $0.50 just a day ago

Getaround expected the restructuring to save it more than $10 million in 2013, and ongoing savings of more than $2 million each quarter are projected. Plans call for reducing the company’s contract workforce by 25 percent, which is expected to saved an additional $3 million in 2013. In addition, Getaround said it would stop using outside professional services for certain tasks and instead outsource them internally or through third-party providers.

The layoffs are the latest in a series of controversial moves by Zaid, who has been with Getaround since its early days as a garage sale company. In 2017, he ordered an abrupt shutdown of Getaround’s main business in North America, citing disappointing user growth rates. Earlier this year, he announced that the company would be shuttering its European operations.

The restructuring is projected to result in significant cost savings on an annualized run-rate basis. These gains will allow the company to maintain its position as a leading transportation network for Contemporary Arts events and continue expanding its services.

Getaround’s decision to go public via a SPAC merger has likely affected its balance sheets by increasing its cash burn. The company reported $45 million in revenue for the first nine months of 2022, which is a decrease from $48 million the year prior. However, Getaround had $27.2 million in cash to play around with at the end of Q3, so it appears that not too much has changed yet.

The merger would have brought the company another $228 million of profits and continued its growth. The combined company would be able to make more money and achieve its next phase of growth. Overall, this was a great move for both companies and the merger was successful.

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Kira Kim

Kira Kim is a science journalist with a background in biology and a passion for environmental issues. She is known for her clear and concise writing, as well as her ability to bring complex scientific concepts to life for a general audience.

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