Airbnb is closing down its domestic operations in China owing majorly to intense price rate competition and then the surfacing of Covid-19.
According to the company, employees across the country will be notified as early as Tuesday morning in Beijing.
All mainland Chinese listings, including residences and experiences, will be gone by the summer. Since its launch in mainland China in 2016, Airbnb has faced increased competition from rival players. The section was already pricey and tough to run, according to sources. The epidemic just intensified and compounded these issues.
Despite in-country branding and putting Airbnb cofounder Nathan Blecharczyk in charge of operations, Airbnb stays in China have only accounted for about 1% of income in recent years.
According to reports, Airbnb sees a greater opportunity in Chinese outbound travel, and the company will focus on providing listings for Chinese travelers visiting other countries. According to one insider, Airbnb’s outbound and domestic operations had little overlap. Airbnb, according to one source, will have a major presence in Beijing with hundreds of employees.
Despite plunging more than 30% this year amid a broader selloff in technology stocks, the company’s stock remains well above its $68 IPO price.
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Airbnb was hit hard by the covid epidemic in the early days, laying off over a quarter of its workers in May 2020 before going public in November of the same year. According to the company’s IPO prospectus, hosts in China utilised a different cleaning software than the five-step cleaning process used elsewhere to eliminate covid transmission.
People began to travel again, and as a result of the flexible work arrangements that many employers created during the epidemic, the company has seen an uptick in long-term rentals this year. The Chinese economy, on the other hand, has taken much longer to recover because the country has been shut down on a regular basis to tackle new waves of virus.
