The Jakarta Post
Homegrown hotel aggregator start-up Airy will cease operations by the end of May as the COVID-19 pandemic hits the hospitality business.
The company said in an email to its property partners that it would cease its agreement with them as the company had stopped operational activities.
“We have done our best to overcome the impact of this disaster. However, given the significant technical decline and reduction in human resources, we have decided to stop our operations permanently,” read the email as reported by kompas.com on Thursday.
The email continues by stating that after May 31, the company would no longer provide services to its partners. The decision came after the start-up laid off around 70 percent of its staff last month.
The hospitality and travel sector have been the hardest hit by the pandemic, forcing more than 700 hotels in the country to close down as social distancing calls and travel bans continue globally to contain the coronavirus spread. The disease has infected more than 12,700 people in Indonesia, with the death toll reaching 900 as of Thursday afternoon, according to official data.
Airy public relations manager Vinda Mudita told The Jakarta Post that she was unable to give detailed information about the layoffs and business shutdown.
The start-up’s CEO, Louis Alfonso Kodatie, previously said the company had tried to mitigate the effects of the pandemic. He expressed optimism that the travel industry would recover.
Established in 2015, Airy has 2,000 properties with more than 30,000 rooms. It will be the first hospitality start-up to permanently cease operations in the country, as similar companies continue to furlough and lay off workers, as well as impose pay cuts to cope with the outbreak impacts.
Budget hotel booking platform RedDoorz is working on a zero-revenue assumption until next year and has laid off around 10 percent of its workforce. Meanwhile, OYO has furloughed its employees as it saw a 50 to 60 percent drop in revenue and occupancy.