Vroom to let go 11% workforce 

As a part of company’s restructuring plans, Vroom has decided to reduce its workforce. In an internal assessment, the company announced to let go of 120 employees which is about 11 per cent of its total workforce.

The reduction in workforce is said to be implemented on April 26, 2023, excluding the United Auto Credit Corporation (UACC), automotive financing company that the e-commerce company acquired back in Feb 2022.

Taking into account previous reductions, the recent reduction in force at Vroom (excluding UACC) resulted in a decrease of around 55 per cent of the company’s employees and contractors since January 2022.

The company will be providing severance payments to all the laid off employees, incurring cash charges of roughly $2 million. However, the company feels that the reduction will have a positive impact on its overall cash flow, and it will save approximately $15 million annually in cash. If this has to be combined with the previously announced reduction in force from January 2023, which was about $27 million, Vroom’s total annualised cash savings would amount to approximately $42 million.

Vroom recently announced 20 per cent job cuts in January 2023. As per the SEC filing, the company handed pink slips to approx 275 employees. During the January cuts as well, no employees were affected from the UACC.