TOKYO -- Ola, India's biggest ride-hailing company and one in which Japan's SoftBank Group has an equity stake, will cut 1,400 jobs, or 35% of its domestic workforce, as the novel coronavirus slams India's economy.
Ola's revenues tumbled 95% in the past two months as India went into lockdown.
Ola decided on the cuts as it cannot determine whether Indians, after the lockdown is lifted, will use transit services at the same levels they did before the virus struck.
Ola co-founder and CEO Bhavish Aggarwal delivered news of the job cuts in an email to employees, local newspapers reported. "The prognosis ahead for our business is very unclear and uncertain," he was quoted as saying. "It is going to take a long time for people to go out and about like before."
All transport services were banned across India, in principle, in late March. Although the lockdown has been eased since May 4, allowing Ola to resume operations in areas with a small number of virus patients, restrictions remain in place in urban areas, where ride-sharing demand is traditionally at its strongest.
Established in 2011, Ola also provides ride-hailing services in Australia, New Zealand and the U.K. It has more than 2.5 million contract drivers in over 250 cities. It also provides payment and meal delivery services.
In addition to SoftBank Group, Chinese internet services giant Tencent is an investor.
U.S. rival Uber Technologies has also unveiled plans to cut jobs, about 7,000 worldwide. Some media reports say Uber plans to cut between 500 and 700 jobs in India.