Online Travel Industry Suffers Losses Due to COVID-19 Outbreak
The travel industry is suffering severe losses due to the coronavirus pandemic. Online-only companies are no exception. Airbnb reportedly incurred hundreds of millions of U.S. dollars in losses and considers seeking funding from new investors. The company changed its cancellation policy, allowing customers to get full refunds for their trips planned for the next month, simultaneously causing major losses for hosts, as new bookings drop. Another digital travel company, Trivago, saw its shares fall by double-digits in mid-March, as the COVID-19 pandemic continued to spread. Similarly, Expedia Group’s shares plunged by -35% between March 16 and 18. The company gave full refunds to customers who booked travel to certain countries and is challenged by a surge in number of requests submitted to its call centers. Along with other industry participants, Booking Holdings revoked its previous financial guidance due to COVID-19 uncertainties.
China’s leading OTA Trip.com warned that its Q1 revenues could fall by up to 50%. At the same time, as the COVID-19 pandemic lessens, Trip.com and Qunar opened up online pre-sales of domestic trips for April and May, anticipating growth in demand.
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