TrueCar Employees Hit With Layoffs Amid Revamp
When TrueCar president and CEO Chip Perry announced a revamp of the car-shopping site, he failed to mention one big change: layoffs.
According to a source and confirmed by TrueCar, an undisclosed number of the company’s employees — mostly located at its headquarters in Santa Monica — received layoff notices yesterday.
TTAC learned some employees in TrueCar’s development team received layoffs, according to a source. However, when asked, TrueCar would not detail the departments affected nor the number of employees laid off.
According to company spokesperson Carly Schaffner, the layoffs are part of a corporate realignment.
“We are constantly evaluating ways in which we can better serve car buyers, dealers and automakers. We recently determined that organizational changes were necessary to more closely align our workforce with the needs of the business,” said Schaffner.
“While we intend to add employees in certain areas of the company — most notably to our dealer sales and service group — a determination was made that reductions were needed in other areas. Regrettably, this has resulted in the elimination of a number of positions, mainly in our Santa Monica office. We are grateful for the service of all our employees and will work to make this transition as seamless as possible.”
The layoffs closely follow Perry’s pledge to dealers that outlined a list of changes to improve transparency for customers while bringing dealers onside.
“Our goal is to provide the best value for car buyers and dealers among all third-party automotive sites, but it was apparent to me that there were aspects of TrueCar’s service that were suboptimal,” Perry said at the time.
TrueCar has not been immune to controversy as of late.
A group of 100 dealers launched a lawsuit against TrueCar last year, claiming the company engaged in “deceptive business practices” by not disclosing the $299 and $399 dollar fees paid by dealers for new and used car sales brokered by TrueCar.
AutoNation, one of the largest dealer groups in the United States, broke off its relationship with TrueCar in July 2015, reportedly because TrueCar wanted extensive access to AutoNation’s sales data.
In August 2015, then-CEO Scott Painter announced he would leave the company toward the end of 2015. He was replaced by Perry, a former AutoTrader CEO, in November 2015.
TrueCar stock has plummeted from $16.13/share a year ago to $5.22/share at today’s open, representing a loss in value of more than 66 percent.
[Image: TrueCar]
More by Mark Stevenson
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The "revamp" is supposed to make the site more dealer favorable by giving consumers less information about pricing, incentives, etc. This is like training your mule not to eat. Just when they get the site to the point where dealers really love it (when it provides NO useful information to consumers, just dealer provided marketing fluff), the # of consumers logging on will hit zero.
TrueCar lost their mojo about 5 years ago. I'll still msrp a car out on there, but their prices are inflated compared to what people are paying on the ground.