The news that Booking Holdings – with brands that include Booking.com, Kayak, Priceline, Agoda, Rentalcars,com and OpenTable — is to cut up to 25% of its employees, around 4,000 in total due to the ongoing impacts of COVID-19, is definitely not what the industry wants to hear right now.
GlobalData travel & tourism analyst, Johanna Bonhill-Smith observes that: “While there are embryonic signs of an uptick in demand, this news from Booking Holdings shows the struggles travel operators will continue to experience as they wrestle with the deleterious impact of COVID-19.”
Bonhill-Smith said that: “The fact remains that 41% of global travelers expect to reduce international travel in 2020. Ever-changing rules regarding quarantine, cancellations and general travel between destinations worldwide continue to decimate consumer confidence, which is the largest barrier facing travel recovery.”
She continued: “Unfortunately, as the battle with COVID-19 continues to rage and the larger industry players continue to make significant cuts, this suggests that more lay-offs may occur as hardships are felt by all.”
And Bonhill-Smith pointed out that: “As the world’s largest online travel agent (OTA), Booking Holdings is undoubtedly one of the strongest players to battle through this pandemic but these substantial layoffs show that cost-cutting remains a vital component to weather this pandemic.”
She added that: “With an asset-light business model, OTA’s remain at a clear strategic advantage to in-store travel agencies but even they are not immune.”
And Bonhill-Smith concluded: “Other leading online operators including Expedia Group, TripAdvisor and Airbnb have already made significant cuts to their workforce in reaction to this pandemic and in a bid to cut costs.”