28 Jul 2020 - 2 min read
Jakarta, Indonesia, July 28, 2020 – The recent COVID-19 crisis has put the travel sector in an unprecedented challenging state. Since the pandemic broke, the restrictions on travel and many other activities to curb the spread of COVID-19 around the globe inevitably created a potent combination of stricken demand and travel disruption and not surprisingly, Traveloka also witnessed a historic drop in business activity to levels never seen before.
Traveloka’s partners across transport, accommodation, activities, and dining also experienced significant disruption to their business - there was feeble demand for transportation with contrasting escalation of refund requests; hotels saw the lowest occupancy ever; several domestic and regional activities and dining partners chose to shut their doors temporarily due to high uncertainty.
“Without a doubt, Traveloka has been profoundly affected by the COVID-19 pandemic. We have experienced the lowest business rate that we have ever seen since our inception. However, we always believed that the company will prevail by rapidly adjusting our strategy, working with our industry and ecosystem partners, as well as continuing to innovate for our users, our ultimate focus,” stated Ferry Unardi, Co-founder and CEO of Traveloka.
Driven by an unwavering motivation to emerge on the other side of this crisis stronger and better, Traveloka implemented necessary business optimization measures to conserve capital and refocused its effort to prepare for an effective act in the new normal. For example, in Indonesia, Thailand and Vietnam, Traveloka has seen a resurgence of domestic, short-distance travel and activities bookings as the population learns to live responsibly with the pandemic. Many innovative initiatives to cater to shifting demands were launched, such as COVID-19 Test bundle with Flights, flexible open-date voucher for hotels in Buy Now Stay Later, Online Xperience programs with top Hosts, Traveloka LIVEstyle Flash Sale livestreams, and Traveloka Clean campaign, allowing users additional peace of mind when booking via Traveloka.
In a strong vote of confidence in Traveloka’s resilience and the viability of the regional travel industry, a global financial institution recently led a $250 million funding round for Traveloka together with participation from some existing investors. The new capital is expected to further strengthen Traveloka’s balance sheet and boost efforts to deepen Traveloka’s offerings in select priority areas. This will include building a more robust and integrated Travel & Lifestyle portfolio in key markets as well as expanding its Financial Services solutions to better support ecosystem partners.
“This virus crisis is a crisis of our generation, both for economy and humanity. It is a game reset that has forced businesses to rethink their plans, strategy and the model. Travel industry is facing unprecedented times, including Traveloka. The leadership team has taken difficult yet commendable measures including restructuring and optimization to minimize financial health risks. We are confident that the company will emerge even stronger after this crisis,” said Willson Cuaca, Managing Partner of EV Growth, an existing investor who participated in this funding round.
“I am happy to share that on the business front, we are seeing encouraging recovery across all of our key markets. Our business in Vietnam is approaching steady pre-COVID-19 levels and Thailand business is on its way to surpass 50%. Indonesia and Malaysia are still in the early stage, but they continue to demonstrate promising momentum with strong week-to-week improvement, especially in Accommodation with the emergence of shorter distance staycation behavior. We acknowledge that the sector may go through further turbulence as it navigates new waves, but we feel we are prepared to take on the challenge and emerge on the right side of it,” added Ferry.