According to two sources familiar with the matter, Airbnb is shutting down its domestic business in China. Employees across the country will be informed as early as Tuesday morning in Beijing, according to the business.
By the summer, all mainland Chinese listings, including residences and experiences, will be removed.
Airbnb began operating in mainland China in 2016, but has encountered increasing competition from Chinese players. According to sources, the section was already expensive and difficult to run. The epidemic exacerbated these problems and amplified their impact.
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 sources, Chinese outbound travel has been a bigger opportunity for Airbnb, and the firm will emphasise on providing listings for Chinese tourists visiting other countries. According to one insider, there was little overlap between Airbnb’s outbound and domestic businesses. According to one insider, Airbnb will have a large operation in Beijing with hundreds of staff.
Despite falling more than 30% this year amid a broader selloff in tech equities, the company’s stock is still trading considerably above its $68 IPO price. Airbnb suffered in the early days of the covid epidemic, cutting off nearly a quarter of its workforce in May 2020 before going public in November of the same year. The company indicated in its IPO prospectus that hosts in China employed a different cleaning software to avoid covid transmission than the five-step cleaning method it used everywhere.
As individuals began to travel again, business improved, and the company saw an increase in long-term rentals this year, thanks to the flexible work arrangements that many businesses implemented during the pandemic. The Chinese economy, on the other hand, has taken significantly longer to recover, as the country has been regularly shut down to combat subsequent waves of infection.