Carvana Co. plans to lay off about 1,500 employees, or about 8% of the company's workforce, executives said in a Friday memo to staff.

The planned workforce reductions come as the used car retailer faces economic headwinds and an uncertain future, Chief Executive Ernie Garcia said in the memo.

"We failed to accurately predict how this would all play out and the impact it would have on our business," Mr. Garcia said.

The workforce reductions will affect the company's corporate and technology teams, as well as some operations teams.

"To those impacted, I am sorry," Mr. Garcia said. "As you all know, we made a similar decision to this one in May. It is fair to ask why this is happening again, and yet I am not sure I can answer it as clearly as you deserve."

Employees affected by the layoffs will receive separation and severance pay through Jan. 1, 2023, plus one additional week of severance pay for every full year of tenure, Mr. Garcia said. They will also receive extended health-care coverage for three months and will receive priority consideration once Carvana begins hiring again, among other resources.

Carvana representatives didn't immediately return requests for comment.


Write to Kathryn Hardison at kathryn.hardison@wsj.com


(END) Dow Jones Newswires

11-18-22 1244ET