News: Oyo to sack 5,000 globally as Covid-19 outbreak hits business

C-Suite

Oyo to sack 5,000 globally as Covid-19 outbreak hits business

"The Covid-19 outbreak, which has ravaged the world’s second-largest economy, has hit Oyo's operations in China," says Oyo group CEO Ritesh Agarwal.
Oyo to sack 5,000 globally as Covid-19 outbreak hits business

Oyo Hotels & Homes is firing about 5,000 employees across the globe, with a significant number of the dismissals taking place in China.

According to reports, Oyo is in the process of firing an estimated 3,000 direct employees in the country and temporarily laying off some of its 4,000-strong discretionary staff.

Earlier in January, CEO Ritesh Agarwal told media, that Oyo’s global headcount will be about 25,000 after the dismissals. It has a total of 20,000-22,000 employees in just India and China.

According to reports, this is the total number of employees impacted as a part of the global restructuring exercise announced in January 2020 and includes all markets impacted like India, China, and the US, already publicly reported."

The company, which is valued at $10 BN, didn’t provide a country-specific breakup of its overall employee headcount.

The SoftBank-backed hospitality chain has pumped more than $600 MN into China, since it officially announced its entry into the market in late 2018. For the year ended March 2019, it recorded a loss of $197 MN from its Chinese operations. That’s almost 60% of the overall loss recorded by the company in the last financial year.

Oyo’s hotel partners in China are said to have accused the company of violating contractual agreements. Oyo says it operates more than 10,000 hotels in China.

Company representatives didn’t provide the exact number of hotels on its platform, citing the Covid-19 outbreak. Oyo fired 25 employees in the country in April 2019 and issued warnings to another 100 as it sought to crack down on what it described as “unethical practices”.

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Topics: C-Suite, #COVID-19

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