Freight rate software provider Freightos will lay off just under 50 employees due to the growing impact of the coronavirus disease 2019 (COVID-19) on its business, the company told JOC.com Tuesday.
Freightos operates on a number of fronts, providing freight rate management software to forwarders; a freight rate marketplace for forwarders, container lines, and shippers; rate indexes; and an air freight sales and operations management subsidiary called WebCargo. The layoffs will mostly impact Freightos’ rate marketplace business.
“COVID-19 is hitting both the supply chain and financial ecosystem particularly hard,” Freightos chief marketing officer Eytan Buchman said in a statement to JOC.com. “We’re proud to have built an impactful technology company playing a vital role in supporting carriers, forwarders, and importers. To ensure that we can do so for many years to come, we regretfully are forced to consider downsizing part of our team.”
Buchman said WebCargo and the Freightos marketplace “remain strong companies (with more than 200 employees around the world).”
“This is a pivotal moment for digital air cargo, as capacity and prices fluctuate rapidly,” he said. “We’re also seeing heightened activity on freightos.com as companies adjust to new supply chain patterns. That said, we anticipate financial markets seizing up and are displaying extra precaution with our financial reserves.”
Freightos has raised about $92 million through a number of investment rounds, most recently a $44.4 million injection in September 2018, led by the Singapore Exchange.
Freightos is only the latest prominent logistics startup to address the challenges of an uncertain freight market by cutting staff. In early February, the drayage technology provider NEXT Trucking laid off 70 employees, representing about 19 percent of its workforce, followed the next week by forwarder Flexport letting go of 50 people, which represented about 3 percent of its global workforce.
Despite the layoffs, Freightos has had a busy month, announcing a multifaceted partnership with FedEx, covering integrated trade compliance solutions for buyers on its marketplace, while FedEx Logistics will use WebCargo to manage pricing and booking with airlines.
In early February, the Baltic Exchange started publishing a rate index it developed with Freightos to be used as a benchmark for shippers and other parties in the container shipping industry.