Chinese e-commerce giant LeEco has fired 85% of its staff in India amid signs of growing financial strain on the company and this could lead to its possible exit from the country.
An Economic Times report by Writankar Mukherjee and Rasul Bailey cites three top industry sources as saying that two key executives – Atul Jain, CEO of smart electronics business and Debashish Ghosh, COO for internet applications, services and content – have put in their papers as well.
Chinese billionaire Jia Yueting had written an email to employees in November stating that his company had expended its cash reserves too fast by expanding into areas like smartphones and driverless cars, the report says.
Industry sources have maintained that the losses at the parent firm coupled with a shift in focus towards China and US could be reasons for the company’s possible exit from India.
Sales of the company have also been affected post demonetisation in November, the sources said as per the report.
The company has already fired several staff from its Delhi and Mumbai offices and is currently dismissing many people in its research and development centres in Bengaluru, the report adds.
LeEco India COO Alex Li said, "All businesses need to be profitable to be sustainable. That has been the primary objective in taking certain measures, though the numbers (of layoffs) indicated are incorrect."