The rental accommodation platform has struggled with domestic competition
Online accommodation booking firm Airbnb is reportedly shutting down its business in China with all mainland Chinese listings to be taken down as early as this summer.
The California-based company is planning to announce the decision to its employees in the country this week, according to two sources familiar with the matter quoted by CNBC.
Airbnb launched its mainland China business back in 2016, and has reportedly faced mounting competition from domestic players. The sources also said the Covid-19 pandemic had exacerbated challenges faced by the company as it struggled against local rivals.
Despite putting Airbnb co-founder, Nathan Blecharczyk, at the head of its efforts in the country, stays in China on the platform only accounted for approximately 1% of revenue in recent years.
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According to CNBC’s sources, Airbnb will retain hundreds of employees in an office in Beijing to refocus on providing listings for Chinese travelers going abroad, as outbound travel continues to open up bigger opportunities for the company.
Airbnb’s shares have dropped over 30% this year amid a broader selloff in tech stocks, but it’s still trading well above its 2020 IPO price of $68. The company had to lay off nearly 25% of its staff in the early days of the coronavirus pandemic. In its IPO prospectus, Airbnb highlighted that hosts in China used a cleaning program to prevent Covid transmission, which was different to the uniform five-step cleaning process it implemented in the rest of the world.
The company’s Chinese business showed some signs of recovery when people resumed traveling, but was hit again by repeated lockdowns aimed at tackling subsequent waves of infection.
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