Online car retailer Cazoo said it will reduce about 15% of its workforce and slow new hiring in an effort to cut costs.
According to the a company news release Tuesday (June 7), the cuts — which will impact approximately 750 people — are part of a broader plan by Cazoo to save more than 200 million pounds ($250 million) between now and the end of 2023.
Founder and CEO Alex Chesterman said the current economic climate has led Cazoo to make some “tough but necessary” choices about the company’s priorities.
“The combination of rising inflation and interest rates with supply chain issues caused by the pandemic and war has driven up the cost of living and hit consumer confidence,” he said. “This perfect storm has placed cash conservation top of mind for the company, ahead of growth.”
Read more: Cazoo Expands Online Car Platform to Spain
Cazoo said its goals are to lower its selling, general and administrative costs per unit while minimizing the impact on growth, in addition managing costs and expenditures to become self-funding in the U.K. without need of more capital.
Along with the job cuts, Cazoo said it will reduce spending on marketing, limit its capital expenditures, postpone several investment projects and focus on more efficient buying and reconditioning to drive GPU growth.
Cazoo said it will also no longer offer its subscription service to new customers beginning at the end of June “given the highly cash consumptive nature of this business model.”
Founded in 2018, Cazoo gives customers access to a fleet of reconditioned vehicles that they can purchase online after reviewing 360-degree images of the cars and details about its features and history.
The company has sold more than 65,000 cars in the U.K. since its launch two years ago and has since expanded to France, Germany and Spain. The firm has talked of plans to begin operations in Italy later this year.