Bottom line: New acquisitions by China Lodging and Tongcheng reflect consolidation in China’s travel industry, which is likely to accelerate in 2016 as the nation’s economy slows.
China Lodging goes upmarket with new buy
Two smaller acquisitions from the travel realm are in the headlines as we close out 2015, with China Lodging (Nasdaq: HTHT) and Tongcheng both buying domestic companies. The first deal will see China Lodging, operator of the HanTing budget hotel chain, purchase a smaller operator called Hotel Home. The other comes in the related travel services space, and has Tongcheng buying a smaller rival called Shanghai MCTS.
Neither of these deals looks extremely exciting as both are quite small, but both do reflect a recent wave of consolidation that is sweeping China’s fragmented travel industry. Industry veteran Ctrip (Nasdaq: CTRP) is emerging as the clear leader and top consolidator in the travel services space. The hotel space is a bit less clear, with China Lodging, Homeinns (Nasdaq: HMIN) and Jin Jiang (HKEx: 2006; Shanghai: 600574) all jockeying for position in that space. Read Full Post…
Bottom line: Google’s registration of a company in Shanghai’s Free Trade Zone is the latest incremental move in its crawl back to China, but the company will focus on apps and is unlikely to re-enter the sensitive Chinese search market.
Google searches for China opening in Shanghai
What’s becoming one of the slowest homecomings of all time has just taken another small but significant step forward, with reports that US Internet titan Google (Nasdaq: GOOG) has formally registered a new company in a 2-year-old Free Trade Zone (FTZ) in Shanghai. The move had Chinese media buzzing about an imminent return to China by Google, nearly 6 years after the company shuttered its local search service after a high-profile dispute with Beijing over censorship.
Like many of the earlier reports, this latest report looks mostly incremental and doesn’t seem to portend any imminent announcements by Google. But the reports do contain a couple of interesting developments that could hint at how the company plans to do business in the world’s largest Internet market if and when it does return. The 2 key new elements are Google’s potential choice of Shanghai for its new China base, and its registration of a new search and email services company to be run under the separate name Pengji. Read Full Post…
As this year’s first blast of winter made headlines in Shanghai, another item on a new program to curb bicycle theft transported me back to a warmer time that now seems like a distant memory from China’s past. Anyone who spent time here in the 1990s or earlier clearly remembers that past, when bicycles were the main mode of private transport and ruled the streets of everywhere from top-tier cities like Shanghai all the way down to the smallest rural villages.
Those days are mostly gone in the present, when car ownership has become one of several prerequisites for young city dwellers seeking to attract future partners in today’s Shanghai. But the growing problems of congestion and pollution are making Shanghai think twice about the desirability of too much car ownership, which perhaps is behind a growing number of recent programs like this one aimed at easing concerns about things like theft and inconvenience. Read Full Post…
Bottom line: Shanghai’s clampdown on piracy of the Disney brand reflects the city’s desire to protect its huge investment in the soon-to-open Shanghai Disneyland, and also Disney’s growing clout in China.
Shanghai protects Disneyland investment
Disney (NYSE: DIS) pirates, beware. As the grand opening of mainland China’s first Disneyland draws near, the park’s home city of Shanghai is stepping up efforts to protect is multibillion-dollar investment by clamping down on piracy of the Disney brand. That crackdown is certainly long overdue, and has just netted 5 hotels that were illegally using the Disney name to dupe visitors into thinking they were affiliated with the US entertainment giant.
In an interesting aside to this clampdown story, the 5 properties busted in the new clampdown were owned by Shenzhen-based Vienna Hotels Group. That’s significant because in August Vienna was reportedly in talks to be acquired by Shanghai’s leading hotel group Jin Jiang (HKEx: 2006; Shanghai: 600754). (previous post) Thus this latest crackdown could signal the Jin Jiang-Vienna talks ultimately collapsed, since it’s unlikely Vienna would have been targeted in such a high-profile way if it was part of the locally well-connected Jin Jiang. Read Full Post…
Three headlines involving pets in and around Shanghai are shining a spotlight on just how fast dogs and cats have multiplied on our city streets, and the many conflicts arising as a result. As someone who grew up with both dogs and cats in my home, I can certainly understand the attraction of having pets as part of a household environment with children.
But that said, some Shanghai residents seem to be taking the pet phenomenon to levels unseen in the west, putting themselves in growing conflict with people who would prefer to return to a pet-less past that was the norm in China until recently. Read Full Post…
New plans to consolidate the dozens of long-distance bus stations throughout Shanghai made me slightly nostalgic, reflecting the diminishing use of buses for inter-city travel over the last 2 decades. Anyone who only reads the news might never be aware of this rapid shift, since the papers are constantly filled with reports on the latest horrific collision or fiery crash involving a long-distance bus that leaves dozens of travelers dead. Read Full Post…
Shanghai and most major Chinese cities lack organized outdoor food centers and night markets, which are a colorful and popular part of daily life in places like Taiwan, Hong Kong and Singapore. But now that’s changing here in Shanghai, which is rolling out ambitious plans for a series of such centers modeled on the famous Shihlin night market in Taipei.
This kind of move seems long overdue, and could kill many birds with a single stone. Most importantly it would help to rid the streets of annoying hawkers, and it would also remove a source of noise and congestion that is irritating for nearby residents. It would also tackle the problem of food safety, since concentrating such hawkers in supervised centers would make it easier to monitor their quality. Read Full Post…
This week’s Street View takes us for a stroll through the city’s parks, many of which will extend their opening hours under a trial program to improve access to Shanghai’s open spaces. As a westerner, I find the idea of limited access and operating hours for city parks a bit strange, since most US parks are “open” all the time and have no barriers or fences to limit public access.
Accordingly, I hope this trial program will ultimately lead to the removal of fences and other barriers that now surround are city’s parks in the next few years, providing much-need open spaces to offset the rapid encroachment of skyscrapers and other tall buildings. Read Full Post…
In brand-obsessed China, it seems that even something as abstract and esoteric as a free trade zone (FTZ) can become a mingpai, or famous brand. That’s my quick assessment, on reading that our city’s highly hyped FTZ is getting ready to embark on a nationwide campaign to spread its name and business model as it approaches its first anniversary.
More broadly speaking, this move by the Shanghai FTZ shines a spotlight on the Chinese obsession with famous brands. As a China resident of many years, I’ve noted this fascination with mingpai has a long history in modern China dating back to well before the current reform era. But this latest move to create a “brand” around the new FTZ seems a bit extreme, and perhaps indicates it’s time for China to tone down its obsession with famous names. Read Full Post…
E-commerce leader Alibaba has long insisted on a shareholding structure that would put all decision making powers in its top managers, and now we’re getting a taste of what that could mean with word that the company will buy a stake in one of China’s best known soccer teams. On the surface at least, this deal doesn’t look very attractive. Most or all of China’s soccer clubs are losing money, and the league has a record for poor marketing and also a series of corruption scandals that have hurt its reputation. Any ordinary Alibaba shareholder would probably instantly veto such a purchase if he had that kind of voting power. Read Full Post…
Shanghai doesn’t get the chance to host many global events, so it’s understandable that city officials are quite excited about a major upcoming conference that will see attendance by the likes of President Xi Jinping and Russian President Vladimir Putin. But that said, the massive security drive now underway is getting a bit out of control, literally reaching new heights with word that kite flying will be banned as part of the safety effort during the event. Read Full Post…
