Online travel aggregator MakeMyTrip (MMT) is laying off around 350 employees, or 10% of its workforce, citing business slowdown due to the global travel restrictions to combat the spread of covid-19.
The downsizing exercise at MMT has impacted non-tech roles at the group level, including Goibibo, said a company spokesperson. Goibibo and MakeMyTrip had merged their businesses in 2017.
In an email to employees, MMT chief executive officer Deep Kalra said the pandemic has affected the travel and tourism sector, and there was a need to “revisit" some business strategies as the company doesn’t expect the travel market to bounce back soon. Mint has reviewed a copy of the letter.
Globally, the travel and tourism segment has been the worst hit, compared to other consumer segments. In India, bookings for both international and domestic flights, homestays and hotels witnessed a significant dip, especially after the government placed visa and travel curbs on international routes in late March.
The Centre, however, relaxed lockdown norms in the first week of May and has recently reopened domestic flights in a staggered manner. Yet, air travel and interstate travel is currently being restricted by many states, including Karnataka, after covid-19 cases spiked soon after domestic flights started.
“It’s unclear when travelling will become a way of life, as it was in pre-covid day. As a result, it’s become agonizingly clear that there are certain lines of business (LoBs) that are far deeply affected and will take much longer than the others to recover. As we revisited some of our strategic imperatives to be able to sustain our business in the long term, it is evident that the pandemic has changed the context and viability of some of our business lines in its current form. Keeping this in mind we have had to take this sad but inevitable decision of rightsizing our workforce in these businesses."
Kalra added that all employees affected by the downsizing process will be provided with medical coverage, including family members, till the end of the year. The company will also ensure gratuity payments, and outplacement support for all 350 employees.
The decision to cut jobs at MMT and Goibibo comes months after the online travel company furloughed salaries of 3,000 employees due to the slowdown in business.
Apart from the MMT group, online travel startup Travel Triangle has also let go of around 250 of its 600 employees in March after the business took a hit due to the pandemic.