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Ctrip to Establish Investment Subsidiary in 2013

Oriental Morning Post, 2/04/13

Speaking on February 1, Chinese online travel service provider Ctrip (Nasdaq: CTRP) CEO Fan Min said that the company plans to be "higher-profile in its investments" in 2013, with investments "to exceed all previous scope." Fan also stated that Ctrip will establish a dedicated investment subsidiary. The company's three primary avenues of investment will be:

1) Products and services related to or complementary to Ctrip's main business, particularly in the leisure travel market;

2) Emerging business ecosystems, innovative, or synergistically complementary products in areas including mobile internet and social networks;

3) Travel companies and related companies in Asia and other overseas regions.

After the end of the Chinese New Year holiday in mid-February, Fan said, Ctrip will kick off a large-scale sales promotion for airplane tickets. "We will take complementary factors like hotel bookings and travel group deals into account when planning the airplane ticket sales promotions," Fan said. "Ctrip deals with a far greater volume of tickets -- 15 times as many as the second-largest online travel agency -- than any other company, so there is plenty of room for profit."

Besides kicking off a sales war in airline tickets, Fan said that Ctrip will continue to wage its price war in the area of hotel bookings. Starting in Q1 2013, Ctrip will begin to increase its penetration into the low-end hotel and small- to mid-sized urban markets.

Editor's Note: For more information on this topic, please see "Rumor: Ctrip to Appoint Chairman as Co-CEO," MD 2/01/13 issue.

Keywords: strategy Fan Min Internet investment Ctrip online travel CTRP online ticketing

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