Airbnb plans to stop offering home rentals and other tourist experiences in China by July, as first reported by CNBC. Airbnb co-founder and China chair Nathan Blecharczyk attributed the decision to “pandemic challenges” in an open letter posted to WeChat. The company will keep its office in Beijing and re-focus its strategy to cater to Chinese tourists traveling abroad.
To be sure, Airbnb faced obstacles in the China tourism market even before the pandemic, navigating pressure from the Chinese government to share user data. It also faced steep competition from the Chinese home-sharing services Tujia and Xiaozhu and the online travel booking company Ctrip. Since Airbnb entered China in 2016, rentals have accounted for just 1% of its overall revenue.
What is the future of travel in China?
The company’s decision is an indicator of just how uncertain the future of tourism in China looks these days. The country’s borders are closed to the vast majority of travelers coming from abroad, and are likely to remain so as long as China’s covid-zero policy remains in place.
Domestic travel within China is still possible, but restrictions vary by city and province, and Shanghai’s strict lockdowns have served as a reminder that the government is quite willing to crack down on the movement of its citizens in the interest of containing the virus’s spread. Travel during China’s recent May Day holiday was down 60% from the previous year, according to the country’s Transport Ministry.
Airbnb pulling its listings out of China is a concession to these pandemic realities. But in committing to outbound travel in China going forward, the company is also betting against recent trends. Beijing, after all, recently introduced a new policy that imposes new limits on “unnecessary” foreign travel for Chinese citizens and requires people to have an “essential” reason (such as education, business, or medical needs) to obtain travel documents.
Some worry these changes augur an increasingly isolationist future in China that may persist even as the pandemic eases. But Airbnb’s new strategy relies on cross-border travel for Chinese residents—particularly to other Asian nations—rebounding in the months and years ahead.