As lockdown eases, people are planning their summer trips. The proof of this is that Airbnb is getting more booking than expected for this summer.
As people were home for a couple of months due to COVID-19, now they want to use this time to plan trips, travel, and meet people.
Americans Ready to Travel
In the US, Airbnb got more bookings between May 17 and June 3. It also saw more bookings coming in for Memorial Day on May 25, as compared to the same time in 2019. This shows that Americans are all set to travel even if they have to travel within the United States.
CEO Brian Chesky said people are opting for destinations, which are within 200 miles and can be reached by driving from their home. International travel restrictions are making it difficult for people to travel outside of their home countries.
Moreover, he said that because of a shift in working from home pattern people are looking for one week or longer. He said, “Work from home is becoming working from any home.”
There has been an increase in domestic bookings in Portugal, Germany, and South Korea.
Certainly, the global travel industry came to halt at the start of the year because of the pandemic outbreak. The CEO of the company predicts that the revenue for this year will be half of what it was last year.
However, the company’s eagerly awaited initial public offering could still come this year because of the rise in business.
Chesky said, “We’re not ruling out going public this year and we’re not committing to it.”
Loss of Revenue
Similarly, to other travel companies, Airbnb also suffered losses due to Covid-19. This online booking platform laid off its staff by 25%. The company plans to lower its scale and put a hold on new investments in hotels, resorts, and flights.
Some hosts are even selling their properties because of the steep decline in bookings.
The company also announced to pay their employees health insurance costs for a year. About 1,900 people were affected by the lay off plans of Airbnb out of its 7,500 staff.
The company said it will take at least 14 weeks to pay the affected staff. The company raised $2bn from investors to get through the slump. However, this amount will cover health insurance costs for the international workers till the end of the year and for 12 months for US employees.
The actions taken by Airbnb are a signal that the travel industry is preparing for a recession
However, the CEO of Airbnb mentioned that travelers prefer to travel in their own car instead of air travel.
American Airlines said last week there is a better than expected increase in the demand for air travel. Therefore, the airline is adding more flights to its July schedule.
Most importantly, it is increasing its Florida and mountain destinations flights in the West. Its stock rose a whopping 50% last week. United (UAL) is also restoring some major international routes too.