Grab to lay off 360 people, or about 5% of its employees

Grab is laying off about 360 people, or slightly less than 5% of its employees. Co-founder and CEO Anthony Tan made the announcement in a letter to Grab employees today.

A Grab spokesperson told TechCrunch that the company will not be shutting down offices, and that this is the last organization-wide layoff the company will perform this year.

"We do not face capitalization issues. We conducted the layoffs to become a leaner and more efficient organization and we did this by sunsetting non-core projects, consolidating teams and pivoting to focus on deliveries," the spokesperson said. "We remain laser-focused on adapting our core businesses of transport, deliveries, payments and financial services to address the challenges and opportunities of the new normal."

She added that the company will talk to affected employees over the next few days.

Grab is the largest ride-hailing platform in Southeast Asia, and like other travel-related companies, including Uber, Lyft, Oyo and Airbnb, its on-demand ride business has been hit hard by the pandemic. Grab also operates several other businesses, however, including deliveries and digital financial services, which it is currently reallocating resources toward because demand for them has increased during the pandemic and stay-at-home orders.

In his announcement, Tan wrote, "Since February, we have seen the stark impact of COVID-19 on businesses globally, ours included. At the same time, it has become clear that the pandemic will likely result in a prolonged recession and we have to prepare for what may be a long recovery period."

"Over the past few months, we have reviewed all costs, cut back on discretionary spending, and implemented pay cuts for senior management. In spite of all this, we recognize that we still have to become leaner as an organization in order to tackle the challenges of the post-pandemic economy."

He added that Grab will sunset some "non-core projects," consolidate functions and reduce team sizes. It is also reallocating more resources to its on-demand delivery verticals.

"We were able to save many jobs through this redeployment of resources and it helped limit the scope of the reduction exercise to just under 5 percent," Tan wrote.

Grab employees who are laid off will receive severance pay, as well as an enhanced separation payment; a waiver of annual cliffs for equity vesting; medical insurance coverage until the end of the year; encashment of unused annual leave and GrabFlex credits; and, for expecting parents, encashment of their parental benefits, as of the last day of employment.