According to LatePost, Chinese ride-hailing firm Didi starts laying off thousands of employees across almost all departments. This move follows their delisting from the New York Stock Market and pursuing to be re-listed in Hong Kong last December. After the setback last year, the Beijing-based company has seen its capital nearly halved at $37.6 billion.
It is reported that the redundancies will be finished in two rounds: the first round of layoffs is in February while the second round will be in April. By the end of April, 20% of Didi’s current employees will be out of work. Resources have pointed out even though there will be differences between departments, all departments with the exception of the driverless and international business departments will be affected by the decision.
The decision this time is not out of blue and there are some signals which indicate this. Didi clearly had a hard time in recent months: from its app being pulled from app stores after its US IPO to company-related apps being removed as Chinese regulators crackdown on overseas listings.
After the harsh decisions, Didi’s revenue (China Mobility) in Q3 2021 shrunk from 44.8 billion RMB ($ 7.07 billion) to 39 billion RMB ($ 6.15 billion), almost 13% lower than the revenue in Q2 2021; the market share of Didi also dropped from 90% to 70% during this period.
In Didi’s IPO paper last year, the company planned to invest in its technology capabilities including shared mobility, electric vehicles, and autonomous driving technologies, and expand its business outlook in selected international markets outside of China. The company does provide an app called “Didi-Rider” in the App Store for markets such as Australia, Japan, and many countries in South America. However, the path for Didi to grow their presence in other countries has not been smooth sailing, and competing with companies like Uber remains a huge challenge.