Research
Interview Synopsis

Booking & Expedia – pre-earnings industry update

  • Public Equity
  • Consumer
  • Europe

Closed borders, movement restrictions and fear of illness have resulted in substantial declines in the number of holidaymakers, proving damaging to online travel agencies (OTAs) such as Booking.com and Expedia. A former managing director from Expedia Group Inc was interviewed by Third Bridge Forum to explore how these companies have fared and what the future holds.

Click on the hyperlink below to access the full Forum transcript.

COVID-19 throws OTA performance potential up into the air

The near-term outlook is not positive. Highlighting the YoY volume drop that Booking.com experienced earlier this year, the specialist expected that Q4 is likely to plunge further in light of lockdowns in European markets. 

How various countries choose to holiday and what impact this could have on OTAs was also discussed. Germany, France and the UK represent about 40-50% of holiday volumes across Europe. While France has a higher rate of domestic tourism, holidaying in the UK is driven by escaping to better weather: “if somebody can’t go somewhere that’s warm, they just won’t travel.”

The US, on the other hand, faces less movement restrictions and has a much higher percentage of people choosing domestic travel. And this will prove beneficial to OTAs with a greater exposure there: “the importance of the US market to Expedia will weight more domestic bookings into Expedia’s numbers and, at the moment, probably more [of] a robust performance.”

As well as exploring the difference in average daily rates and length of domestic and international vacations, the details of business versus leisure travel were laid out. The specialist also commented on how bargaining power between chain hotels and OTAs could be redistributed if business travel permanently declined post-recovery.

To access all the human insights from Third Bridge Forum’s Booking & Expedia – Pre-earnings Industry Update Interview, click here to view the full transcript.

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