The FINANCIAL — Airbnb Inc’s bookings in major cities across the world have plunged. People are deciding to cancel travel plans because of the coronavirus outbreak. Also, there is an increasing number of travel restrictions being put in place around the world.
Some online travel companies have already issued warnings. Expedia, which runs sites such as Hotel.com, has said it expects the virus to hit its earnings by somewhere between $30m (£24m) and $40m. Meanwhile, Booking.com, the travel booking platform which is home to more than six million “alternative” listings for apartments and home-stays, earlier this week pulled its forecasts, saying demand had fallen across regions, but that it could not “reliably quantify” the effect. At AirBnb, for example, estimates suggest there are more than 650,000 hosts offering their homes up for short-term rentals. Guests have the option of booking from as many as 1.9 million options across the world, at any given time. Airbnb has taken some steps to deal with an expected influx of cancellations. It established a new “extenuating circumstances” policy for refunds – a move it said would “offer impacted hosts and guests the option of cancelling eligible reservations without charge,” according to Telegraph.
The world’s biggest home-sharing company – Airbnb reported a loss of $276.4 million excluding interest, taxes, depreciation and amortization, compared with a loss of $143.7 million a year earlier, according to a person familiar with the company’s accounts. With a private market valuation of $31 billion, Airbnb had been seen as one of the most highly anticipated stock listings for 2020, Bloomberg wrote.
Airbnb has seen its bookings collapse by 40 per cent in big European cities and China because of the Covid-19 pandemic, according to independent data, putting its plans for an initial public offering this year in doubt. Data from analytics group AirDNA showed a severe drop in bookings across Europe in the past two weeks of February, as tourists began to delay or cancel their travel plans in the face of the outbreak. In China, AirDNA projected year-on-year revenues for Airbnb hosts in Beijing would fall 43 per cent in March, after a 22 per cent decline in February. Before the crisis, China was Airbnb’s fastest-growing market, The Financial Times reported.
When comparing Airbnb bookings for properties in Beijing, China, from January 5 through 11 with those made from March 1 through 7, the data shows a huge 96% drop in reservations, making it the hardest-hit city to date. Actual numbers for Beijing show a total of 40,508 bookings made for Airbnb properties for January 5-11, compared with just 1,655 bookings for March 1-7. Also in China, Airbnb’s Shanghai hosts are suffering, too, with properties there seeing a 71% drop in reservations. Outside of China, Seoul in South Korea, which has been hit hard by COVID-19, has seen a 46% drop in Airbnb bookings, and outside of Asia, Rome in Italy has seen a 41% fall. In the U.S., New York City, for example, has seen a 21% decline. With more governments bringing in travel restrictions in a bid to slow the spread of COVID-19, and major events being cancelled, Airbnb cancelations look set to increase, with bookings likely to dip as well, Digital Trends wrote.
Airbnb proposes flexible reservation policies over coronavirus. Read more.