Axe may fall on over 1,000 jobs at Indonesia’s Tokopedia after merger with TikTok Shop
[JAKARTA] ByteDance is gearing up for major job cuts and a significant operational scale-back at its Indonesian e-commerce platform Tokopedia, following this year’s mega merger with TikTok Shop, sources say.
The Business Times understands that the cuts, potentially involving more than 1,000 jobs and expected within days to a week, follow an extensive months-long internal review uncovering widespread redundancies post-merger.
Bloomberg reported around 450 jobs will be cut in the first round of layoffs.
A ByteDance spokesperson said that the company needs to make adjustments following the merger of TikTok and Tokopedia.
“We have identified areas that need strengthening within our organization and aim to better align our teams with company goals,” the spokesperson said in a statement on Friday (Jun 14), adding that the company will continue to strive to support the impacted workers during the transition period.
The phased layoffs come as ByteDance plans to eliminate redundant roles created by overlapping positions, particularly in several divisions, due to the merger, sources reveal.
Senior executives are expected to visit the Indonesian office next week to explain the extensive layoffs. The first phase will grant affected employees a two-month grace period with full salaries but no operational duties.
Additionally, severance packages will be provided to those laid off.
According to a source, ByteDance also plans to deprecate nearly 80 per cent of internal services and technologies by the end of the year, transitioning to solutions developed internally by ByteDance and other TikTok operations.
TikTok completed its merger with Tokopedia in January this year, following Indonesia’s government ban on TikTok Shop in the country due to violation of its e-commerce law.
The deal resulted in TikTok acquiring a controlling 75 per cent stake in Tokopedia for US$1.8 billion, while the remaining 25 per cent was retained by GoTo, Tokopedia’s parent company.
Tech in Asia reported that TikTok needed to establish a new entity, obtain an e-commerce licence from the Ministry of Trade, and create a standalone TikTok Shop app to reverse its ban in Indonesia – all of which are now fulfilled.
