Carvana Abruptly Cuts 12% Of Workforce Through Zoom And Email, Employees React

Arizona-based pre-owned car retailer Carvana laid off about 2,500 employees, or approximately 12% of its total workforce Tuesday through email and Zoom, triggering a Twitter tirade among staffers who expressed frustration over how the company handled the layoffs. The company has since cited slow growth as a reason for the job cuts.

In a statement to The Hill, a Carvana spokesperson said that while the company “is still growing, our growth is slower than what we originally prepared for in 2022, and we made the difficult decision to reduce the size of certain operations team to better align with the current needs of the business.” The company said it will provide “meaningful assistance” to impacted employees, including four weeks of pay for every affected staffer and an additional paid week for each year the employees worked with Carvana.

Tuesday’s sudden move fueled talks among affected staffers and local media, with some workers claiming that the Zoom meeting was pre-recorded. Garrett Archer of KNXV-TV said employees shared the video with him and that affected staffers “independently said it was pre-recorded.” Archer said Carvana denied the claims.

A spokesperson for the used car retail company also told Protocol that “less than half” of the job cuts were conducted over Zoom, adding that the company “had as many conversations as we could in person.”

However, the spokesperson did not specify how many of the employees were laid off through a Zoom meeting and how many had to be let go through emails. One Twitter user wrote: “Not my job sending an email to the entire company stating they’re forced to do massive layoffs…” The Twitter user also said the emails caused “massive hysteria at 7:30AM.”

A Twitter user said the layoffs also took place at the Atlanta, Georgia, branch. It “was a wild ride” Tuesday at the said branch, the user wrote. Another user said he will never “get a car from your company for those layoffs,” adding that the retailer already allegedly “packed” the belongings of released employees “before the meeting to fire people was even over.”

One Twitter user, who claims to have been part of the layoff, released supposed screenshots of the layoff emails sent to affected employees from Carvana founder and CEO Ernest “Ernie” Garcia. In the screenshots, Garcia supposedly explained the reasons for cutting thousands of jobs, noting that the layoffs “will be concentrated in our operational positions.” The email also acknowledged that an apology “doesn’t go very far to change what this means for you and for your family.”

An 8-K form filed by Carvana Tuesday with the U.S. Securities and Exchange Commission (SEC) revealed that executives at the company were giving up their salaries for the rest of 2022 in a bid to help chip in for the severance pay of fired employees.

Last month, the company, dubbed a pandemic star by analysts, posted net losses of $260 million in the first quarter of 2022, as opposed to its $36 million Q1 net loss in 2021. Following the retailer’s first-quarter report, Carvana shares dropped as much as 24%.