27 April 2023 , 16:22
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Ride sharing app Lyft is to sack 1,072 workers after struggling to compete with Uber, the company has announced.
4,000 employees were informed of the news on Thursday and told which offices would shut - with 26% of Lyft's workforce being axed.
The business also said it would not be hiring for an additional 250 positions.
Sona Iliffe-Moon, a Lyft spokeswoman, said in a statement: "This is a hard decision, and one we’re not making lightly.
“But the result will be a far stronger, more competitive Lyft.”
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The major job cuts come after David Risher, the company’s new chief executive, revealed the business is struggling to keep up with the competition provided by Uber and Bolt.
The company is struggling to compete with Uber (AFP via Getty Images)Mr Risher, a former Amazon and Microsoft executive, has taken over for John Zimmer and Logan Green, the company’s founders.
He said: “We need to bring our costs down to deliver affordable rides, compelling earnings for drivers and profitable growth."
The ride sharing app has struggled to compete with Uber, who have emerged from the pandemic in a stronger position than its rivals - thanks to delivering food.
Lyft sacked 13% of its staff back in November and in February the company reported record revenue current.
Lyft co-founders John Zimmer and Logan Green stepped back from the business (Ringo H W Chiu/AP/REX/Shutterstock)However, employees had been expecting the sackings after business consultants were drafted in to justify their budgets in a bid to make savings.
Company executives had been hinting to staff there would be more job cuts throughout spring and were expected to come during mid-April.
The news comes after fashion retailer Gap is set to sack around 1,800 employees as an attempt to cut costs and streamline operations, the company has said today.
Lyft had been looking to make cuts (AP)Upcoming job cuts were first revealed on Tuesday, April 25, with roles at headquarter locations, upper field positions and workers including regional store leaders with leadership titles outside a headquarter office set to be impacted.
In a statement, interim CEO Bobby Martin said the redundancies are expected to create an annual saving of around $300 million. He said they are "taking necessary actions" to "reshape" Gap "for the future".
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Martin also said the cuts will "release untapped potential" across the company's brands, which include its namesake line, Old Navy, Banana Republic and Athleta.
"We are taking the necessary actions to reshape Gap Inc. for the future - simplifying and optimising our operating model, elevating creativity, and driving better delivery in every dimension of the customer experience," Martin said.
"These changes include the consistent brand leadership structures we announced last month aimed at flattening the organisational structure to improve the quality and speed of decision-making, while in turn reducing overhead expense."