Hotel chain startup Oyo today denied rumors that the India-based firm has fired 1,000-plus employees from its China team.
But the startup – valued at US$5.7 billion amid global expansion of its Uber-for-motels business – did confirm to Tech in Asia that some people were fired, with a China-based spokesperson saying that Oyo will “not continue to hold low performers in the organization.”
Photo credit: Unique Hotels
Oyo is still expanding with an eye on “sustainable performance growth” and has 8,500 global employees at present – a figure that’s expected to rise to 10,000 by the year-end and 15,000 in 2020, according to the company spokesperson.
Chinese tech blog Jiemian yesterday reported that half of the estimated 2,000 business development team at Oyo China had been axed, plus an additional half of staff on the operations team (of an unspecified size), but an Oyo representative in China today would not confirm the number.
Another executive, Sundeep Babbar, told Tech in Asia that there’s “a lot of wrong information” going around, but likewise declined to give specific details.
An Oyo spokesperson based in India added: “The presumption of any letting go is wrong, where regular monthly performance reviews are being twisted and reported out of context. Especially since we just announced an investment of US$100 million in China today [that will go] towards talent, customer experience, and quality and system improvements.”
Tough room
Citing insiders familiar with the matter, Jiemian’s report also claims that Oyo is spending around US$22 million per month on its China operations, mostly on personnel.
Aside from the headcount, Oyo is also supposedly spending to entice China’s independent hotel owners to convert to Oyo branding – sweeteners include a zero franchise fee (in contrast to China Ru Jia Hotel chain, Oyo’s closest rival in the nation) and a subsidy on each transaction made by a guest.
Oyo entered China in November 2017, and now claims to have over 10,000 locations with half a million rooms across 320 Chinese cities. Globally, it has over 23,000 hotels in 800 cities.
Converted from Chinese yuan. Rate: US$1 = RMB 6.88.
(Updated three hours after publishing: Added in comment from India-based spokesperson).
Editing by Judith Balea and Eileen C. Ang
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