Image source: REUTERS
Airbnb Inc, a vacation rental company, will withdraw from China, following other companies who decided to exit the Chinese markets. The company announced on Tuesday that it would shut down all its listings and experiences in mainland China starting July 30.
The Airbnb management announced its withdrawal via its official WeChat account. However, the reasons for their decision were not stipulated in the announcement. Even with the company out of China, Chinese users would still be able to book listings and experiences.
Airbnb co-founder Nathan Blecharczyk said in a statement, “We have made the difficult decision to refocus our efforts in China on outbound travel and suspend our homes and Experiences of Hosts in China, starting from July 30, 2022.”
According to a reliable source, whose information was published in a Global Times issue, Airbnb’s exit was triggered by the costly operation costs and other restrictions being put on the company. Coupled with the effects of the COVID-19 pandemic, the company had no choice but to shut down its domestic facilities in China.
The media await Airbnb’s official comment on the matter.
Airbnb is the latest in the list of Western internet companies that have exited China due in part to the country’s decision on internet decoupling. While China is the second-largest economy, companies like LinkedIn and Yahoo still chose to retreat from the country.
Further, issues relating to censorship, operational hurdles, and others are what prompt many Western internet platforms to shut down their services in mainland China. Meta’s Facebook and Alphabet Inc’s Google have earlier said the same.
To top these issues, the ongoing lockdown protocols and business restrictions because of the COVID-19 pandemic bring more issues to the plate. For example, major economic hubs closing in Shanghai all cause foreign investors to consider withdrawing from China.
According to a report by the New York Times, the retreat of Airbnb from China will cost them 150,000 listings, roughly comprising 1% of their revenue. The company is six million strong globally, and its exit from China will not cause them much damage.
The company opened its services to Chinese consumers back in 2015, seven years after it was founded in 2008. Airbnb also localized services by partnering with WeChat, competing with market rivals Xiaozhu, Meituan, and Tuija.
The volatility of the global markets has affected the shares of the company. On Monday, it gained 0.7% on Nasdaq but has been subject to a 1.6% decrease in market trading.
Airbnb’s rival in China, Meituan, said that it would help Airbnb hosts to pin listings on their platform via its vacation rental business Meituan Minsu. Tuija, another of its rival, announced the same.
Opinions expressed by NY Weekly contributors are their own.