Airbnb Reportedly Shutting Down Its Domestic Business In China

Airbnb to close its domestic business in China due to high competition (photo: Airbnb)

JAKARTA - Airbnb is reportedly closing its domestic business in China due to rising costs and domestic competition.

Citing CNBC, this news was obtained from two sources familiar with the news. The company plans to notify its employees on Tuesday, May 24 morning in Beijing.

Airbnb officially launched in mainland China in 2016, during which time the company has faced a lot of competition.

The source also said that the segment was already expensive and complicated to operate, and again, the pandemic had only exacerbated the problem.

Much like what happened to Uber in China, a host of local competitors makes it difficult for foreign companies to gain an edge.

The source also told CNBC that traveling out of China is a big opportunity for Airbnb and the company will refocus on providing services for travelers from China going overseas.

Shares of the company have fallen more than 30 percent this year. At the start of COVID-19, Airbnb had laid off 25 percent of its staff in May 2020, then went public in November last year.

Today, almost all businesses have recovered as people are able to travel again. However, the company sees that Chinese businesses are much slower to recover as the country periodically goes into lockdown to combat the next wave. Airbnb declined to comment on this.