Airy Permanently Stopped Operating by the End of May due to Pandemic

The startup operator of the cheap hotel chain Airy, announced it would cease operations in Indonesia permanently from May 31, 2020. This decision was taken because Airy’s condition was battered due to the coronavirus pandemic (Covid-19).

Quoting Tech In Asia, Thursday (7/5), Airy has sent e-mails or e-mails to hotel partners, stating Airy will terminate the cooperation agreement with partners following the decision to terminate operations.

In the e-mail, they explained that his party had tried to overcome the impact of the Covid-19 pandemic. However, given the significant technical decline, as well as a reduction in human resources, Airy decided to stop operating the business permanently.

“For this reason, after May 31, 2020, we cannot provide services to all our partners,” Airy said in an e-mail, reported from Tech In Asia, Thursday (7/5).

In fact, at the beginning of March 2020 Airy was still optimistic about being able to pass the Covid-19 pandemic storm. In an interview with Tech In Asia, the Chief Executive Officer (CEO) Louis Alfonso said the company was constructing a strategy to reduce the impact of the Covid-19 pandemic that had affected Airy’s occupancy rates.

At that time, Louis stated that his side was optimistic that the corona pandemic would be resolved soon and the travel industry would recover, as well as Airy. He even said, by utilizing Airy’s technology, it would be able to rise faster and restore business as before.

Last April, Airy Reportedly Laid-off 70% of Its Employees

However, in April 2020 Airy was reported to have dismissed 70% of its staff. Airy itself currently has a network of 2,000 properties, with a total room capacity of 30,000 units.

Before the emergence of the corona pandemic, Airy underwent a management reshuffle in late 2019 and early 2020, according to former Airy employees told the KumparanTECH. The management reshuffle led Danny Handoko, the founder, to give up his position as CEO to Louis Alfonso.

This management change made several Airy officials and middle-level employees resign, according to the former employee. After that, Airy also did a large-scale termination of employment in March. Another KumparanTECH source said he was one of the employees laid off by Airy in March when the call for work from home (WFH) was running.

Quoted from KumparanTECH, Airy has been questioned regarding this issue. However, the company’s spokesman was reluctant to comment.

Airy was founded by two former Traveloka employees, Danny Handoko, and Samsu Sempena. The company that was founded in 2015 ago is also a strategic partner of Traveloka Indonesia. The tourism sector did receive a severe blow due to the Covid-19 pandemic, as well as its derivatives such as hotels and restaurants.

Hospitality is One of the Sectors that is Directly Affected by the Pandemic

The Indonesian Hotel and Restaurant Association (PHRI) said there were thousands of hotels and hundreds of restaurants closed due to the corona pandemic. The tourism industry also lost potential income from foreign tourists of US $ 4 billion or around Rp 60 trillion from January to April 2020.

Until April 13, 2020, PHRI members had closed 1,642 hotels. Also 353 restaurants or entertainment venues that had closed as well. The tourist destinations that felt the most tourist numbers were Manado, Bali, and Batam.

The Ministry of Tourism and Creative Economy noted that until the second week of April 2020, 180 destinations and 232 tourist villages were closed. Even so, PHRI assesses that the data do not reflect conditions on the ground because not all members report the actual conditions.

Hospitality has also carried out several strategies to maintain its business, such as making lodging packages for self-isolation, lodging for medical personnel, and Insider Oversight (ODP), to lodging for foreigners quarantined. PHRI also opens options for cooperation with local governments to provide quarantine places for travelers.