Company, which started process on Tuesday, has not informed how many people will be dismissed
01/11/2023
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Layoffs involve only Brazil; company started process on Tuesday — Foto: Divulgação
The wave of layoffs in technology companies has reached Didi’s Brazilian mobility service 99. The company, which started the process on Tuesday, has not said how many people will be dismissed. The layoffs involve all areas of the company, sources say.
“To continue democratizing our services, including digital payment solutions with 99Pay, we have conducted extensive evaluations of our resource allocation across all lines of business,” a company spokesperson told Valor. “As a result of this and other operational factors, we made the difficult decision to conduct an internal reorganization. Unfortunately, we had to dismiss a group of employees this week, to whom we are extremely grateful for their contributions,” he added.
The company did not inform how many people will be dismissed, but the layoffs involve only Brazil. Currently, there are 3,920 Brazilian employees registered on the company’s LinkedIn profile.
“Knowing that the macroeconomic environment also directly impacts our users and partners, we affirm our commitment to continue offering more affordable services to our more than 20 million active users, generating value for the entire ecosystem we support,” the spokesperson said. “According to a study by Fipe, 99 indirectly injected R$54 billion into the Brazilian economy over the last 10 years,” he added.
Layoffs at tech companies in the country became frequent since March last year, including cuts in major companies like Creditas, Loft, QuintoAndar, and iFood, all of them valued at more than R$1 billion.
In February, the meal delivery app 99Food will start operating without its own fleet, keeping only the platform, as Valor reported last week. The fleet reduction process started in January 2022.
99 reported that it will expand two-wheeled services beyond passenger and parcel transportation for individuals. At the end of the month, the company will launch 99Entrega Moto Corporativo, a logistics service aimed at companies, in 3,000 cities where it already offers other services with motorcycles.
“Overall demand for our services on two wheels – 99Moto and 99Entrega Moto – has grown by more than 50% over the past three months compared to the third quarter of 2022,” said the company’s spokesperson.
99’s parent company is going through a delicate time in China. Didi was one of 14 technology companies investigated by the Chinese government for more than two years, alongside giants such as Alibaba and Tencent Holdings around suspicions of abusing its dominance in the Chinese market.
On Monday, Guo Shuqing, the chairman of the China Banking and Insurance Regulatory Commission (CBIRC) and Chinese Communist Party secretary of the People’s Bank of China (PBOC), told Nikkei Asia that supervision of the sector will be normalized and government support will be provided to help platform companies play a bigger role in job creation and global competition.
The investigations led to the suspension of Ant Group’s IPO and the delisting of ride-hailing giant Didi Global from the New York Stock Exchange (NYSE) just five months after its debut, Nikkei Asia added.
Founded in 2012 as an app-based car transportation company, 99 received a $100 million injection from Chinese company Didi in January 2017 and was acquired by the group in 2018. Currently, the group has stakes in companies such as Chinese electric car company SmartAI, hotel company Oyo, and leads investments in truck freight, bike sharing, motorcycle rental, and self-driving car companies in China.
*By Daniela Braun — São Paulo
Source: Valor International