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Airbnb’s CEO and co-founder claims that COVID-19 has permanently changed the way people travel, especially as it affects international excursions, according to company data trends.
With summer vacation season upon us, San Francisco-based Brian Chesky, the Airbnb boss, maintains that people will travel by car more and to closer-in destinations. National parks could be a big winner under his analysis.
In an interview with Axios, he asserted that “I will go on the record to say that travel will never, ever go back to the way it was pre-COVID; it just won’t. There are sometimes months when decades of transformation happen.”
“People are not getting on airplanes, they’re not crossing borders, they’re not meaningfully traveling to cities, they’re not traveling for business,” he added. “They’re getting in cars. They’re traveling to communities that are 200 miles away or less. These are usually very small communities. They’re staying in homes and they’re staying longer.”
As far as spending more time in the great outdoors on federal land, Chesky explained that “Most people haven’t gone to [national parks]. And it’s pretty cheap … You don’t need to buy an airplane ticket. You can usually drive because most people live within 200 miles of a park. So, I think you’re going to start to see travel becoming more intimate, more local, to smaller communities.”
Given the coronavirus-related economic dislocation, Airbnb laid off 25 percent of its workforce last month, amounting to about 2,000 lost jobs. It also put an IPO on pause. According to CNBC, Airbnb lost nearly 50 percent of its net worth as of April 30 of this year. “In March 2017 Airbnb was valued at $31 billion. By the end of April 2020 it was worth $18 billion.”
“But the global pandemic is proving to be Airbnb’s biggest challenge yet. The company is struggling with cancelations and reimbursements after Airbnb announced it would be refunding customers whose reservations fell within a certain timeframe. This angered many hosts, who were stuck having to pay back most, if not all, of the cost of the rental. And while social distancing measures were in place, some local governments deemed short-term rentals as non-essential businesses, adding more stress to hosts who rely on Airbnb for income,” CNBC explained.
Domestic Airbnb rentals have allegedly returned to normal levels, but international bookings are still way down, he implied. The CEO does anticipate overseas trips eventually picking up, but consumers may visit locations other than traditional tourist hubs like Paris, Rome, or London.
“People will, one day, get back on planes. But one of the things that I do think is a fairly permanent shift is … a redistribution of where travelers go. I think that’s going to get smaller as a percentage of travel in the future, and I think it’s going to get somewhat displaced, or at least balanced, by people visiting smaller communities.”
The flip side is that there are probably some really good deals on airfare and accommodations (through Airbnb private-residence rentals or hotels) to be had in Europe right now, assuming the major cities like Paris are fully up and running.
Business travel (which also includes conventions), which provides massive revenue for the hospitality industry year in and year out is also being permanently transformed, Brian Chesky insisted. “I think a lot of people are going to realize they don’t need to get on an airplane to have a meeting. I mean, I met you in an office, but now we’re on Zoom.”
Hopefully, U.S. employers will make many/most temporary work-at-home arrangements permanent, rather than requiring employees to waste time and gas commuting to and from an office.
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