Coronavirus: Uber lays off hundreds of staff in Egypt as it begins Middle East cuts

Middle East

Uber Technologies laid off hundreds of office-based staff in Egypt on Wednesday, as the global ride-hailing firm made wider cuts amid the fallout from the coronavirus, one current and two former employees said.

The former employees, both of whom lost their jobs on Wednesday, and one employee who retained her post, told Reuters that they had been informed that about 40 percent of staff in Uber’s Egypt offices had been laid off.

That was out of a total headcount of 650-700, they said.

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It came as Uber announced it would cut about 3,700 full-time jobs globally, affecting 17 percent of its employee count.

An Uber spokesman declined to share details of the layoffs in Egypt but told Reuters a total of 46 countries had been affected by the changes.

Egypt, with a swelling population of more than 100 million, is the biggest market in the Middle East for ride-hailing services and has been among Uber’s top 10 markets globally.

The country has taken a series of measures to curtail the spread of the coronavirus, including a night curfew and the closure of schools and mosques.

However, the government has stopped short of imposing a lockdown, and taxis have continued to operate during the day.

‘Alarmingly unknown’ scenario

On Monday, Uber’s Careem subsidiary, which operates a ride-hailing and delivery businesses primarily in the Middle East, said it would be cutting 536 jobs this week.

The redundancies represent 31 percent of the Dubai-headquartered company’s workforce.

The announcement came hours after Uber said it was shuttering its Uber Eats delivery business in several markets, including the Middle East, and laying off several staff.

Careem said it was prioritising the security of the company and that parent Uber continued to believe in its business model and was committed to the region.

“As we have discussed several times in the last few weeks, the crisis brought on by Covid-19 has put our dream and future impact at significant risk,” chief executive Mudassir Sheikha said in a blog on Careem’s website.

Sheikha, who founded the company in 2012, said business was down by more than 80 percent and that it was “alarmingly unknown” when it would recover.

“In this new reality, the surest way to secure Careem for the long term is to drive towards self-sustainability within a reasonable time frame,” he said.

Severance pay

Careem did not say how much it expected to save from the layoffs or which business units staff had been cut from. 

However, it said tech colleagues were protected in relative terms so it could continue to invest in its products.

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Affected employees would receive at least three months’ severance pay, a month of equity vesting and, in some cases, extended visa and medical insurance, including for family members, until the end of the year.

The Careem BUS mass-transportation operation has also been suspended, it said.

Careem has also found “significant savings” from pausing new benefits, it said, without disclosing details.

Uber earlier announced it was closing its food delivery business in Saudi Arabia, Egypt and other countries, while its United Arab Emirates operations would move to Careem.

Uber bought Careem in 2019 for $3.1bn.

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