Dive Brief:
- Airbnb has announced the hiring of founding Virgin America CEO Fred Reid to be its first-ever Global Head of Transportation as the hospitality company eyes a new transportation venture.
- Airbnb did not detail what the new transportation division will entail but said there would be a focus on new partnerships. In a statement, Reid said “there are tremendous opportunities to create products and forge partnerships with other companies that make travel easier and even fun.”
- Reid led Virgin America for three years and was formerly the president of Delta Airlines and of Lufthansa German Airlines. Most recently, Reid was the president of Kitty Hawk’s Cora Aircraft Program, heading up development of an autonomous electric vertical takeoff and landing aircraft.
Dive Insight:
While the details of Airbnb’s transportation interests are unclear, CEO Brian Chesky said in a statement that the company is “not interested in building our own airline” or another ticket-buying website. Instead, it seems that Airbnb will try to build transportation partnerships into its existing hospitality platform, which now offers more than 5 million places to stay around the world.
The expansion also comes as Airbnb is expected to launch an initial public offering (IPO) sometime this year, along with tech giants like Uber and Lyft.
Although it has become a popular booking service that has upended the hospitality space, Airbnb has often found itself struggling with local and state regulators. Massachusetts, for example, recently passed new regulations and higher fees on the short-term rental industry, becoming the first state to crack down on the industry. Cities like New York City and Los Angeles have also recently imposed their own restrictions on people renting out their homes in response to Airbnb’s rapid spread.
Depending on what Airbnb does with its new transportation division, the company could find itself with more regulatory friction, although consumers will no doubt be eager for more travel alternatives that can be combined on one platform.
