LeEco Lays Off 270 Employees In India, Says Won't Exit

LeEco, which has cut its headcount in India to 80 from 350 in December previous year, will not exit the country, the spokesperson said. The company, which had a massive advertising budget of Rs. 80 crore a month, stopped selling its products through offline retail stores in December.

Industry sources have maintained that the losses at the parent firm coupled with a shift in focus towards China and United States could be reasons for the company's possible exit from India.

Chinese handset maker LeEco today refuted reports of winding up its India operations but admitted that it has undertaken an "optimisation exercise" in the worlds second largest smartphone market.

Chinese conglomerate has fired 85 percent of its staff in India.

LeEco, the Chinese smartphone and electronics brand which entered the Indian market previous year, has reportedly laid off 75% of its Indian staff.

Sources have told the Economic Times that people are being let go from LeEco's Delhi and Mumbai units as well as from their R & D centre in Bengaluru.




India Chief Operating Officer Alex Li confirmed the exit of LeEco's executives but denied plans to exit India or liquidate stock. "All this certainly does not signal a company in wind-up mode", the statement read.

Note that in November a year ago, LeEco's co-founder Jia Yueting said that the company was running out of cash in its bid to expand its businesses from electric cars to smartphones.

The company will exit the country in a few months. He said that the company is restructuring, which is why they had to fire employees, as they have a new vision for their business in India.

In the email sent to his employees, Jia wrote "We blindly sped ahead, and our cash demand ballooned". It also poached two top level executives in order to strengthen its presence. "So, LeEco found it neither here nor there", he said, requesting anonymity. Demonetisation also had a big role to play in the falling sales in the Indian market.

Industry executives attributed the likely exit to the financial crisis at the parent firm and its decision to focus on China and the USA, the report said.

(Copyright © 2015. All Rights Reserved.)
 
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