> Layoffs because of AI make no sense to me.

That's because these layoffs aren't about AI. They're about firms that overhired and Wall St is (finally) having a sobering moment of their (profit) growth potential.

It’s not that they believe AI tools are replacing workers, it’s using the new free cash flow allows them to invest in AI.

They are betting that their AI business will be profitable, and need to cut costs to invest in it.

It makes quite a bit of sense if the size of your market doesn't expand along with the new technology and you don't have a competitive advantage. Just because you have the capability to deliver more packages doesn't necessarily mean you'll have customers willing to pay you to deliver more packages.

> In what world does a healthy growing business react to this by laying off couriers "in a pivot to automotive transportation".

Millions of horses got shipped to the glue factory. And many more farriers and stablemasters got laid off.

They just announced GA of agentic assignees. It suggests a year or more of maturation. Rovo Dev has already been a thing.

The Java products are almost EOL.

They have already been assigning JAC tickets to Rovo and $TEAM is down.

What else should be done with the surplus headcount?

You have a package delivery business. The business is stable and optimized, serving all houses in your city. Each courier has a route planned out that they follow each day. They take 8 hours to complete the route and deliver to each house along the way.

Now, cars come along. With the new efficiencies, you find that now a courier takes only 6 hours to do their route. The number of buildings in the city has not increased, there's a cap to how much service you need to provide after which there's no longer any additional benefits. So, do you cut everyone's work day to 6 hours, or do you fire 25% of all couriers and re-route the rest so they now do 8 hour days on longer routes using cars?

Your solution assumes that the extra workforce immediately translates into free growth, but the growth of many businesses is constrained by outside factors. Here it would be the population of your served area.

> Would a healthy business not switch everyone to driving cars and deliver even more packages?

Not unless there were more packages to deliver.

It's more about looking good for Wall Street. For example, Block was just rewarded for a similar move: https://finance.yahoo.com/news/block-stock-explodes-jack-dor...

You need a very different skill set and culture for driving and maintaining cars than for driving and maintaining horses. I honestly think that for big changes like this (if you are willing to accept that AI is such), looking at it from the portfolio management angle, it makes more sense to just nuke the current operation and start a greenfield one.

In your analogy they aren't laying off the drivers, they laying off the horses.

Iow, humans are the horses in this analogy.

You're mixing up what AI is for compared to horses and cars. Horses/cars enable people to be more efficient. AI enables companies to fire people.

Horses/cars improve productivity. AI reduces payroll costs. That's the whole game here.

Because they are now self-driving cats and continue to need less and less monitoring and intervention.

In a world where you don't need 10 horses to do the job of 5 cars, because your business doesn't have a market for 10 cars.

Not really. You have 1000 packages per day (your market share). You need 100 horses each making 10 deliveries or 20 cars each doing 50 deliveries.

So 80 horse riders are out. You can't scale linearly, market is not supply bound usually, it's demand bound.

[flagged]