SUMMARY
Sharma attributed the mass layoffs to automation, which led to reduction of the manual workforce at the lithium-ion battery manufacturing startup
Log9 cofounder attributed the delayed salaries of employees in January to cash flow disruption on account of lower production during the installation of machineries
Founded in 2015, Log9 manufactures batteries for EVs and energy storage, and has reportedly raised nearly $90 Mn in funding till date
Along with delaying the salaries of all its employees for the month of January, battery startup Log9 Materials has laid off 115 contractual employees.
Confirming the development, Log9 Materials cofounder Pankaj Sharma told Inc42 that the startup retrenched “115-ish” contractual workers in a “stepwise” manner. He, however, did not specify the timeline of the same.
Sharma attributed the mass layoff to automation, which led to reduction of the manual workforce at the lithium-ion battery manufacturing startup.
“There has been a lot of automation in the company. Since November, we commissioned automation lines, because of which the dependence on people has gone down. Now, we can make a lot more batteries because machines can make those batteries for us,” Sharma said.
He added that the company has already made severance payments to all the employees impacted by its retrenchments exercise.
On the delayed salaries of employees in January, the cofounder attributed the same to cash flow disruption on account of lower production.
“Also, usually, in the first month of every year there is a reduction in vehicle sales because consumers want to buy the new year’s models. So these two network effects came in, one is, we were giving less amount of batteries to the customers and the OEMs were anyway selling less vehicles,” added the cofounder of Log9 Materials.
He also added that the majority of the salary amount (90%) has already been disbursed. There will be no disruption from February onwards, he assured.
Founded in 2015 by Sharma, Akshay Singhal and Kartik Hajela, Log9 Materials manufactures batteries for electric vehicles (EVs) and other energy storage solutions. It competes with the likes of Ather Energy, Hero Electric-backed Exponent Energy, among others.
Since its inception, the startup has raised nearly $90 Mn, including a $40 Mn Series B funding round led by Amara Raja Batteries and Petronas Ventures in January 2023.
With this, Log9 has joined the list of Indian startups to have laid off employees in the past two years due to an adverse funding environment and rapid adoption of AI-led automation by businesses.
In November 2023, game streaming platform Loco fired 40 employees as part of the company’s realignment process. Prior to that in the same month, Jodo also laid off around 100 employees as part of a cost-cutting exercise on account of lower-than-expected business growth.
