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May 10, 2022, 6:20 p.m. EDT

Carvana laying off 12% of workforce, execs to forego salaries for rest of year

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By Associated Press

DETROIT — Online automotive retailer Carvana Co. says it’s letting go about 2,500 workers, roughly 12% of its workforce, as it tries to bring staffing and expenses in line with sales.

The Phoenix company said in a regulatory filing Tuesday that its executive team is giving up salaries for the rest of the year to help fund severance pay for the workers.

Carvana /zigman2/quotes/206651606/composite CVNA -3.74% , which sells online and delivers used vehicles to buyers, says the laid-off workers will come from operational groups. The company says it will be “transitioning operations” away from its auto reconditioning center in Euclid, Ohio, near Cleveland, as well as from some logistics hubs.

The filing said the moves are difficult, but will “facilitate Carvana returning to efficient growth on its mission to change the way people buy and sell cars.”

The layoffs come just a few weeks after Carvana posted a $506 million loss in the first quarter, six times larger than the same period a year ago.

The company also recently acquired Adesa U.S.’s used vehicle auction business for $2.2 billion.

Carvana shares fell 5.4% Tuesday to $36.68. They are down 84% so far this year.

/zigman2/quotes/206651606/composite
US : U.S.: NYSE
$ 30.34
-1.18 -3.74%
Volume: 8.97M
June 27, 2022 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$5.95 billion
Rev. per Employee
$610,190
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