Cox Automotive plans to cut more jobs as the company restructures its priorities in a shifting industry landscape.
The new layoffs, after a round last year, come as Cox digests several acquisitions made over the past decade. The company is also reorganizing business units to improve efficiencies and pursue new markets, such as ride-hailing.
Cox Automotive, a unit of Cox Enterprises of Atlanta, employs more than 34,000. It includes Autotrader, Kelley Blue Book, Dealertrack, Manheim, NextGear Capital, vAuto and Xtime.
- Headquarters: Atlanta
- Brands: 25
- Employees: More than 34,000
- 2017 revenue: More than $7 billion
A company source said the new cuts would total “several hundred.”
Spokesman Chintan Talati declined to say how many jobs would be cut, but said the reductions would take place across the company.
“We are continuing to evolve our businesses and strategy at Cox Automotive as the automotive industry continues to shift and change,” Talati wrote in an email to Automotive News. “These changes, while difficult, are needed for Cox Automotive to deliver on the most relevant products and services for our clients and the industry.”
In summer 2017, Cox idled 950 employees — about 3 percent of its full-time staff. Another 225 employees decided to retire early through a voluntary retirement program.
Cox’s acquisitions have presented the company with ongoing challenges in integrating disparate technology platforms and workplace cultures, Cox Automotive President Sandy Schwartz told Automotive News last week.
“We are maybe not done with integration, but we are getting to the point where we’re going to get happy with where we are,” Schwartz said. “We still have work to do.”
As the business and market evolve, Schwartz said, “some of those solutions are going to fall by the wayside because we don’t need them anymore. New ones are going to be built.”
He said prioritizing resources requires hard decisions on which areas to double down on and which to abandon.
“You buy these companies and everybody thinks their priority is No. 1,” Schwartz said. But financial and other resources are limited and bets must be made.
For Cox Automotive, which had more than $7 billion in revenue last year, size is a blessing and a challenge.
“We are a big company,” Schwartz said. “We can do a lot of stuff because we have a lot of horsepower.” But that scale also makes it harder to turn the ship, he said.
“What I’ve really worked on is trying to cut some of the difficulty away so we can make decisions faster,” Schwartz said.
The need to get products to market faster drove Cox to integrate its media unit into the retail business this year. The reorganization will shift operations internally but the outside world will see little change.
Dealers already “look at us as one,” Schwartz said at the time.
In August, Cox also said it would consolidate its growing portfolio of tech-related investments to create a Mobility Solutions Group. Foreseeing a future in which fewer consumers will buy or own vehicles, Cox is positioning itself to deliver software and services to car-sharing and ride-hailing companies, vehicle subscription programs and, eventually, robotaxi fleets.
“What we’re doing is setting ourselves up so that we can be a great provider of services,” Schwartz told Automotive News in August. “We’re in a great position to be able to create and develop those next skills and those next services that are going to be needed as we move forward.”
It is potentially a big opportunity. According to an internal company memo, Mobility Solutions Group could grow to revenue of $100 million to $150 million in the next few years, and then balloon into a $5 billion business in a decade.