Used car marketplace Cars24 lays off over 200 employees

Used car marketplace Cars24 lays off over 200 employees

Used car marketplace unicorn Cars24 has laid off over 200 employees across product and technology verticals, as part of a cost-cutting exercise.

This comes at a time when used car platforms have been reporting slowing growth, and are increasingly diversifying into new business verticals in a bid to spur growth. At the same time, the sector has witnessed rekindling investor interest – Cars24’s rival Spinny recently closed a large $131 million funding round.

Confirming the development, in a blogpost, Cars24 founder and CEO Vikram Chopra said: “Over the past few weeks, we have had to make the difficult decision to part ways with around 200 of our teammates across various functions…This is not about how hard someone worked. This is about the bets we placed and where we got it wrong.”

According to Chopra, the “reset” was a result of prematurely building up new verticals without long-term clarity on the viability of these models.

“Over the last few months, we realised that some projects did not deliver what we expected. Some roles were added too early. A few hypotheses simply didn’t hold when tested. And in some cases, we couldn’t offer the kind of growth or learning that people truly deserve. It is easy to blame the market or external factors. But the responsibility is ours,” he explained.

The company will offer severance support, resume and LinkedIn assistance, mentorship, emotional wellness resources, and access to open roles within its network, Chopra said.

Entrackr was the first to report the development.

This comes days after Cars24 has taken a bet in automobile content by acquiring India’s largest automotive forum Team-BHP.

The acquisition is in line with the broader strategy used car marketplaces like Cars24 are adopting to diversify, as they have faced challenges in scaling over the past few years.

While CarDekho has exited the space, players like Cars24 and Spinny have been looking at alternative ways to grow revenue streams and add more services, Moneycontrol reported earlier.

Cars24 recently forayed into the new car market by launching an aggregator platform for dealerships and OEMs, as part of its ongoing strategy to consolidate the car buying process under a single super app.

In FY23, a total of 51 lakh used cars were sold in India and the industry was worth $34 billion. From there, the sector is expected to grow to $73 billion and sell 1.09 crore used cars by FY28, according to the latest Indian Blue Book (IBB) report by 'car&bike' and 'Das WeltAuto by Volkswagen'.