Carvana laid off 2,500 employees today via a pre-recorded message through zoom

https://twitter.com/garrett_archer/status/1524094528126263296

by Lapz • 4 years ago

57 27 4 years ago

tempnow9873• 4 years ago

Note that for legal reasons many of the layoff announcements are HEAVILY scripted. It's possible that the "pre-recorded" message was a teleprompter read or something else that does not allow a lot of back and forth.

There are so many causes for legal action these days the announcements in general have to be very bland.

Note I forget who it was, but there was a post or short video a while back predicting exactly this - 10% layoffs. Some driven by sales, others by companies using the cover of the economy to drop folks they'd like to have rotated out etc. This sounds superficially sales related, but don't know how carvana is doing to judge

pyuser5832• 4 years ago

That’s really not an excuse. Am good manager knows to give a layoff speech without creating legal liability.

The liability comes in how they select who they lay off and the actions taken prior to lay off.

This is simply laziness.

tempnow9873• 4 years ago

This is so wrong it's not funny. If you are going to be laying off folks PLEASE check with someone on HR / legal side before taking the above advice.

A ton of liability has been created historically based on what is said at the time of a termination.

I personally don't like managers who say how hard the layoff is for them, the employee does NOT care. Just get to the point "I have some bad news to share...."

If you are smaller, your emp practices insurance carrier would LOVE if you called them prior to laying someone or a few folks off. Almost all offer free support as this is THE area that generates a huge amount of claims.

grrrrrbox• 4 years ago

How has Carvana been doing over the past year? They focused on reducing the friction in buying/selling used cars, right?

I wonder if they could have suffered from the supply crunch. Last I checked, 5-year-old Corollas were pushing $20k, and a new base model is about the same price.

Anecdotally, I checked Carvana and local dealers when I was looking for a car recently, because I usually buy $5k beaters and drive them into the ground. This time, it didn't make sense to risk a lemon when I could get a bumper-to-bumper warranty for the same price. So I waited until I could find something new at MSRP, and that was that.

gpapilion• 4 years ago

I sold a car to them the other day that was 10 years old for 18k.

I dont think inventory is their issue, but rather the fact they are a lender more than a dealer. They just make a lot of questionable loans and repackage them for sale, sort of.

everybodyknows• 4 years ago

Seven months ago they were "thriving".

https://news.ycombinator.com/item?id=28733634

Stock now down over 90% from high.

twalla• 4 years ago

A friend of mine was in the market for new(used) car and was shopping offers for his old car and Carvana was the highest by a significant margin while Carmax effectively told him "thanks but we've got used vehicles coming out our ears". This was also shortly after the whole Zillow/Opendoor debacle - we started talking about how ridiculous it was that they were offering so much for a depreciating asset, plus covering storage and transporation costs and all the other attendant overhead. He opened a short position and I think closed it after he made about 4x or 5x his initial investment (I think they were at like 70 dollars per share at the time).

olyjohn• 4 years ago

Carvanas pricing was ridiculous. They would offer top dollar. Alue without ever really seeing the car. I think it was very heavily algorithm driven, and wasn't being watched enough by human eyes to looks for anomalies, or just to look at a car and realize that maybe they are offering too much. They have made some sellers very happy with the money they were offering for used cars, but I really think they have been overpaying for a good chunk of thier inventory.

bko• 4 years ago

I wonder if they could have suffered from the supply crunch. Last I checked, 5-year-old Corollas were pushing $20k, and a new base model is about the same price.

There are no new base models available at dealerships and they're not expected any time soon. The list price hasn't caught up to the market conditions so they don't ship any base trim models. The higher trim models are available but dealerships charge 5-10k on top of list price.

vba6162• 4 years ago

I got a new hybrid for around $23K in late 2020, when it looked like I might be commuting again in the near future, and car sales and gas prices were both in the toilet.

For some incomprehensible reason people were buying the nearly-identical non-hybrid model for essentially the same price. It makes me think of the Bloom County cartoon: "Louise, dump the milk! The cat drinks unleaded from now on!"

Now, cars like mine, with 12K miles are being advertised for $30K, sometimes more.

In the meantime, my employer has just eliminated the health-based accommodations that let some people telecommute full time, just as we've got a solid month or so of rising covid cases and the governor setting policies tested positive.

elliekelly• 4 years ago

Did they comply with the WARN Act? I wonder how the "single employment site" is applied to remote workers? Perhaps it's one unforeseen "benefit" of working from the office?

FateOfNations• 4 years ago

Sounds like employers must attribute remote workers to a physical site for WARN Act purposes. The DOL provides the following guidance in that regard:

Workers who primarily travel, who are outstationed or whose duties involve work outside the employer's primary work sites are considered to be assigned to the single site of employment to which they are assigned in the employer's organizational structure, the home base from which work is assigned, or the home base to which workers report. (https://webapps.dol.gov/elaws/eta/warn/glossary.asp?p=Single...)

dtagames• 4 years ago

I went to our new Carvana in Houston last week to see it work. The security guard type who was on duty was almost openly hostile. There was no acknowledgement that I might be a current or future customer. How would he know?

This person was so unpleasant, I decided on the spot I would never buy a car from them, no matter how cool the vending machine or how great the deal.

Having worked in car sales and finance, I can tell you this is a big mistake. If Carvana's plan is to replace dealership staff with a robot and a security guard, then they will soon be out of business.

bdcravens• 4 years ago

The tweet doesn't make it clear, but are these remote or on-site employees? If remote, while cold, I don't see the issue with a remote notification.

tssva• 4 years ago

I have been laid off once in my career. Wasn't a big surprise since it was the 4th round of layoffs and the company was in the middle of a financial scandal. All employees were onsite and the layoffs all occurred via a scripted conference call. HR folks distributed the document packets in person but would not speak except to say they were not allowed to say anything to us.

weezin• 4 years ago

Yeah I don't get why people think being laid off via zoom is cruel. I'd think making a remote employee come in just to be fired would be more cruel.

bin_bash• 4 years ago

Am I weird that I would prefer being let go like this over an awkward 1:1?

Especially if it’s a day where people are being called in one by one to be told the bad news. Let me know on Zoom or hell just send an email and let me move on with my life.

Nathanba• 4 years ago

I don't think it's weird, if the business is deteriorating then getting laid off is just a financial decision. The personal choice of being the target should be up for self reflection anyway (and will be, I suspect). Maybe it helps a little if your boss adds a reason but you should really know the reason anyway.

credit_guy• 4 years ago

awkward 1:1

It does not have to be awkward. The manager can show sympathy, and offer support as much as they can. The person who is being laid off may try to hit the job market right away, and the manager can offer guidance (what the employee should brush up on), references, could try to introduce them to acquaintances. Many times some lucky people manage to move internally, and the manager's support is invaluable in such cases.

And by the way, the manager can also say something like this: "tomorrow I may lose my job too, so I might need your reference, if you think I deserve it". And they should be truthful about it, because, honestly, nobody is immune from layoffs (if you think you are, then it means you are severely underpaid, so try to rectify that).

nativeit• 4 years ago

Carvana is being sued by several state attorneys general over their apparently rampant habit of selling cars and then failing to provide the new owners with their title. There might have been other reasons for their decline, but I'm guessing the widely publicised illegal practices played a role.

vba6162• 4 years ago

That may be so, but the business of online used car sales seems to me like a scam on the face of it.

No matter how much they insist you can return a car you don't like, it obviously is just a manipulative way to get people to commit more, and earlier, and without negotiating, compared to the conventional method of buying a used car.

If it's a good business to be in, that's because they can sell worse cars for higher prices, and that's all. X% more in profit, systematically.

Somewhere, there were people saying "hmm, how can we brainwash people into not negotiating and settling for the first car they test drive?" Because that's been the ideal for dealers since the beginning of time.

Operational problems, if so, are the cherry on top. I suppose that unexpected falling-off of wheels happens when you start to run out of suckers.

krnlpnc• 4 years ago

This company is crooked. Bought a car through them and the 7 day “test ownership” process is flawed. It confuses the RMV and insurance companies leaving you on the hook for fees on a car you tested and didn't keep.

Plus, their certified preowned is worthless. They dropped a used car off in the same condition as they picked it up from the previous owner, and let me waste time fixing issues under their 90 day warranty.

First car shook badly during acceleration, obvious drivetrain problems. Second car did not even pass state inspection, and they already sold my trade so now I’m stuck with it?

On top of that, they took 45 days to pay off the loan on my trade-in, and underpaid it. They sneakily pulled another 10-day pay off quote 45 days after taking my trade and stiffed me out of 2 months of payments made to keep the old loan in good standing.

Absolutely horrible experience. Hope they go under completely.

nunez• 4 years ago

counterpoint: we purchased a used Ford Fusion Energi from Carvana via a trade-in. it was seamless and worked way better than my purchases through dealers. they couldn't deliver the car to our house, so we drove to the vending machine to pick it up. one of the carvana employees drove the trade-in and did a light visual inspection to confirm condition and another handed us our new car. we even saw it go down the vending machine chute.

that was four years ago. car's in great shape still even after several tens of thousands of miles.

they paid off the old auto loan within a few weeks. it was straightforward.

only tesla has this experience beat, but it's close. i hope they expand.

davidkuennen• 4 years ago

Reddit thread https://www.reddit.com/r/Wellthatsucks/comments/umsaak/got_l...

Carvana laid off 2,500 employees today via a pre-recorded message through zoom

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