Grab Singapore Cuts 1,000 Jobs over Fast-growing AI, Rising Costs

TEMPO.CO, Jakarta - Singapore's ride-hailing company Grab has decided to cut 1,000 jobs or 11 percent of its total workforce. In a letter to Grab's employees, CEO Anthony Tan cited the need to manage costs and ensure more affordable services in the long run.

Tan said that the cut was the biggest since the start of the pandemic and that it was not "a shortcut to profitability" but a strategic reorganization to adapt to the business environment.

"Change has never been this fast. Technology such as generative AI (artificial intelligence) is evolving at breakneck speed. The cost of capital has gone up, directly impacting the competitive landscape," Tan said in the letter.

Tan said that even without layoffs, Grab had managed costs and should meet its group-adjusted EBITDA breakeven target this year.

This is a major turnaround from Grab's statement in September last year that it had no plans to undertake mass layoffs despite the weak market. Just three months later in December, Tan told staff the company was freezing most hiring, pay raises for senior managers, as well as cutting travel and expense budgets.

Prior to Tan's announcement, Grab's shares were up 4.7 percent. It then climbed 5.6 percent. In May, Grab reported a quarterly loss of US$250 million but said revenue in Q1/2023 rose 130.3% to US$525 million.

Grab Indonesia's ride-hailing rival GoTo Gojek Tokopedia Tbk or GOTO also laid off workers. The company made drastic cost-saving efforts, including laying off 12 percent of its workers in 2022 and cutting 600 more jobs in March this year.  

MOH KHORY ALFARIZI | REUTERS

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