SAN FRANCISCO (Reuters) – Airbnb is preparing to add transportation options to its line-up of travel services as the online company seeks to find areas of growth outside its original home-renting business.
FILE PHOTO: The logo of Airbnb is displayed at an Airbnb event in Tokyo, Japan, June 14, 2018. REUTERS/Issei Kato/File Photo
Airbnb said on Thursday it had hired veteran airline industry executive Fred Reid as its global head of transportation, marking the company’s most definitive step yet toward executing a plan more than two years in the works.
In late 2016, Airbnb unveiled efforts to become a full-service travel website and hinted at plans to include transportation services travelers could reserve at the same time they booked a home.
Since then, Airbnb has added offerings of guided tours and activities, restaurant reservations, luxury vacation homes and traditional hotels.
Chief Executive Brian Chesky said plane ticketing would not be added to the list.
“I’m not interested in building our own airline or creating just another place on the internet where you can buy a plane ticket, but there is a tremendous opportunity to improve the transportation experience for everyone,” Chesky said in emailed comments.
Airbnb did not specify what that would entail, but a person familiar with the company’s plans said it would partner with transportation providers so they could offer their services. That could include anything from a tour bus operator to a taxi fleet, tuk-tuk driver or river boat guide.
This steady expansion by Airbnb, which started as a website where homeowners could make some cash renting spare rooms, is a bid to become a one-stop travel service for more mainstream sightseers.
The new business lines are critical for Airbnb to continue growing even as its original home-booking business slows, hindered by regulations that have capped short-term rentals in key urban areas such as San Francisco and New York City. Airbnb has been blamed for exacerbating home prices in congested housing markets.
Its aim is for travelers to book every part of their trip on Airbnb, with the company getting a cut of each transaction, buoying its revenue. Airbnb is preparing for an initial public offering this year, and investors will be focused on growth when they decide how to value the company.
Unlike many of its venture-backed, highly valued peers in Silicon Valley, Airbnb is profitable. Airbnb said last year that in the third quarter it had “substantially more” than $1 billion in revenue, a quarterly record for the company, driven in part by growth in smaller towns and suburbs. Its revenue for all of 2017 topped $2.5 billion.
Reid comes to Airbnb after leading the autonomous air taxi division of Kitty Hawk, and following stints as CEO of Virgin America and president of Delta Air Lines and German airlines group Lufthansa.
Reporting by Heather Somerville, Editing by Rosalba O’Brien and James Dalgleish