|Staff Reporter |||Apr 07, 2020 07:26 PM EDT|
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Chinese online travel agency Trip.com revealed that it has seen a slight uptick in domestic travel bookings in recent weeks. The country's largest online travel platform claims that the uptick could be a sign that the sector is heading to recovery.
Travel demand in China had come to a screeching halt over the past few months following the spread of the novel coronavirus that had resulted in strict lockdowns and restrictions. Tourism-centered companies lost millions of dollars in the process, with Trip.com reporting a 50 decline in its first-quarter revenues due to the impact the viral epidemic had on the global tourism industry.
For its full-year earnings in 2019, Trip.com reported an annual profit of 7 billion yuan, or around $991 million. This was a massive 536 percent surge when compared to its profits in 2018. This year, the company doesn't expect to experience the same amount of growth due to the current situation.
Trip.com chairman, James Liang Jiangzhang, acknowledged that the beginning of 2020 was a particularly challenging time for the industry as a whole. However, he assured stakeholders that the industry should quickly recover given the country's successful efforts to contain the virus so far.
During its post-earnings conference call, the company revealed that it has seen a light at the end of the tunnel in the form of an increase in domestic travel bookings. People in China are already booking flights once again as the country brings the epidemic under control.
Over the first two months of 2020, the company reported a 20 percent drop in the booking volumes following the outbreak in China in late January. The travel company revealed that it had started the year out very strong with double-digit growth until January 20, when the outbreak was made public. Over the past few weeks, the company experienced a surge in domestic travel volumes of around 30 percent of normal levels.
The increase coincides with recent reports that more than half of China's domestic airlines have resumed flights. Airlines have also now started to increase prices for their tickets, albeit still being slightly lower than normal levels. Local government officials in select regions have also begun to lift travel restrictions and are reaching out to companies to restart the country's travel and tourism industry.
Last week, China reported zero new domestic infections, news that bolstered confidence in the containment of the epidemic. While China may have somewhat contained the spread of the virus, the rest of the world, particularly Europe, is just now feeling its economic and societal effects.
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