TrueCar, the digital automotive marketplace headquartered in Santa Monica, announced it is eliminating 30% of its workforce effective immediately as part of a sweeping restructuring effort aimed at returning the historically unprofitable company to financial stability.
The layoffs, which local reports indicate affected fewer than 100 employees from a workforce of approximately 400, come just weeks after founder Scott Painter completed a take-private transaction that removed the company from the Nasdaq stock exchange in January.
"This is the hardest part of being a leader," Painter said in a statement. "We approached this thoughtfully and deliberately as a necessary step to refocus the company on its mission. As soon as I reacquired TrueCar, I personally met with every single team member to understand where the company is today so we can get on track to becoming a sustainable, mission-based company."
The job cuts represent a significant blow to Santa Monica's technology sector. TrueCar has been one of the coastal city's larger tech employers and a fixture in the local business community since its founding in 2005. The reduction comes as Santa Monica continues efforts to strengthen its economy following the pandemic, and raises questions about potential ripple effects on downtown commercial real estate demand.
TrueCar did not disclose severance terms or specify how many of the affected positions were based at its Santa Monica headquarters versus other locations.
Earlier this month, TrueCar announced it would discontinue three initiatives — TrueCar+, TrueCar Marketing Solutions, and TrueCar Wholesale Solutions — while exploring the sale or monetization of related intellectual property. The company said it would integrate select capabilities from those programs into its core platform.
Company leadership framed the cuts as a necessary pivot away from what it characterized as an unsustainable growth-focused strategy.
"We are laser-focused on identifying opportunities to strengthen our product and company to ensure TrueCar is actively delivering meaningful value to customers and partners, right now," Painter said.
The company said it is shifting from a "quantity-driven marketplace model to a quality-driven platform," prioritizing clearer pricing information for consumers, stronger relationships with its network of certified dealers, and a more streamlined car-buying experience.
Despite the immediate contraction, TrueCar outlined ambitious long-term goals. The company said it expects to facilitate one million vehicle sales annually within a few years, which it projects would generate more than $1 billion in annual revenue — roughly three times its current size.
TrueCar operates a digital platform that connects car buyers with a nationwide network of certified dealers. The company powers auto-buying programs for more than 250 brands and organizations, including Sam's Club, AAA, and more than 100 credit unions. Because the company went private in January, there is no public stock price to reflect investor reaction to the layoffs.