Bottom line: Qunar could experience some short-term loss of business due to the withdrawal of Home Inns properties from its site, and its open platform business model makes it prone to such problems.
Home Inns checks out of Qunar lodge
Signs of turmoil are coming from the lodge operated by Qunar (Nasdaq: QUNR), with word that the online travel agent has just lost a major customer with the abrupt departure of leading budget hotel chain Home Inns (Nasdaq: HMIN). The departure of such a major customer, if true, would mark a big blow to Qunar, which had a recent similar break-up with chief rival Ctrip (Nasdaq: CTRP). Home Inns’ decision is motivated by different reasons than Ctrip’s, which I’ll explain shortly. But the 2 spats highlight the fact that Qunar’s business model, which centers on an open platform for third-party travel agents, is far more prone to problems than traditional travel sites that directly sell products like hotel rooms and air tickets to consumers. Read Full Post…
A new management shakeup in the top ranks of eLong (Nasdaq: LONG) didn’t excite investors too much, but hints that something is happening behind the scenes at this online travel laggard controlled by US giant Expedia (Nasdaq: EXPE). The shakeup has seen eLong’s CFO and COO both resign, though the company’s CEO is staying in his current position, at least for now. Rumors circulated earlier this year that a buyout could be coming for eLong from sector leader Ctrip (Nasdaq: CTRP), though such a deal never came. Read Full Post…
What nearly became a blockbuster marriage between China’s 2 leading online travel sites has instead ended in divorce, with word that industry leader Ctrip (Nasdaq: CTRP) has formally yanked its hotel listings from the site of the second largest player Qunar (Nasdaq: QUNR). My use of the divorce metaphor here isn’t completely appropriate, since the 2 companies came close but never formally consummated a marriage. Still, the final split in this tie-up is probably the best ending for everyone, since it would have been a rocky road even if the 2 companies had agreed to merge their operations. Read Full Post…
I often write about the travel and leisure industry in this space, with special focus on hotels and online travel agents that are reaping big profits from China’s fast growing middle class with plenty of money to spend on vacations. But another less visible group set to profit from the boom is the cruise industry, which is rapidly discovering a Chinese fondness for traveling aboard vacation palaces at sea. A new report on the trend seemed like a good opportunity to focus on the market, which looks set to offer big growth potential for industry leaders Carnival Corp (NYSE: CCL) and Royal Caribbean (NYSE: RCL). Read Full Post…
I’m normally quite upbeat on leading online travel site Ctrip (Nasdaq: CTRP), but I really don’t understand the logic behind its new decision to sell 10 percent of itself to US peer Priceline (Nasdaq: PCLN). On the surface, the deal looks reasonable enough, pairing Ctrip’s strength in China with Priceline’s in the US and other western markets. But anyone familiar with Ctrip knows the company is fiercely independent and doesn’t work very well with other strategic partners. What’s more, this deal will put even more money into Ctrip’s already bulging cash pot, giving it more funds than it needs.
Big stock moves for veteran online travel agent eLong (Nasdaq: LONG) and newly listed mobile game firm Ourgame (HKEx: 6899) are shining a spotlight on the need for consolidation in many of China’s online sectors, where these smaller players lack the resources to thrive over the longer term. Shares of eLong suddenly soared more than 20 percent in the latest session on trading volumes not seen for years, which will inevitably lead to speculation of a looming buyout offer. Meantime, Ourgame shares tanked 17 percent on their first trading day in Hong Kong, as investors yawned at the chance to buy into yet another mid-sized Chinese gaming firm. Read Full Post…
Leading online travel agent Ctrip (Nasdaq: CTRP) is generally regarded as one of China’s best run and most focused Internet companies, which is why new reports that it’s chasing a tie-up with 2 of the nation’s top group buying sites look a bit worrisome. The company is sitting on top of a huge cash pile, worth nearly $2 billion at the last check in March, and is looking increasingly desperate for places to spend the money. It has already been spurned by some of the travel sector’s most likely acquisition targets, which is probably why it’s now looking elsewhere for places to invest its treasure chest. Read Full Post…
An ongoing consolidation in the crowded online travel space has taken a new twist, with word that industry leader Ctrip (Nasdaq: CTRP) has made a major investment in up-and-comer Tongcheng and is eying a similar tie-up with IPO candidate Tuniu. The latest news comes from one official announcement on Tongcheng, and another media report on Tuniu, showing just how active the online travel space has recently become due to the entry of several new players over the last few years. All of this comes just weeks after Ctrip was reportedly in talks to merge with Qunar (Nasdaq: QUNR), the sector’s second largest player, in a deal that would have created a sector leader with a market value of around $10 billion. Read Full Post…
Just days after reports emerged that China’s top 2 online travel agents were in talks for a potential merger, rivals eLong (Nasdaq: LONG) and venture-backed Tongcheng have announced their own new tie-up that could be prelude to a similar marriage. In an interesting twist, this newest deal looks like it’s being engineered behind the scenes by Tencent (HKEx: 700), China’s leading Internet company that is also a major stakeholder in both eLong and Tongcheng. Such a dynamic would be similar to the bigger deal that emerged earlier this week, which could see leading online search firm Baidu (Nasdaq: BIDU) orchestrate a much larger merger between Ctrip (Nasdaq: CTRP) and Qunar (Nasdaq: QUNR). Read Full Post…
The news has been flying thick and fast these past 2 few for Ctrip (Nasdaq: CTRP), including the latest word that China’s oldest and largest online travel agent could be headed for a merger with fast-rising rival Qunar (Nasdaq: QUNR). I actually predicted this potential merger last fall in the run-up to Qunar’s IPO, even though nothing happened at that time. Now the latest reports are saying such a deal is in late-stage talks as Ctrip prepares to sell a controlling stake of itself to leading search engine Baidu (Nasdaq: BIDU), which also happens to be Qunar’s controlling stakeholder. Read Full Post…
When does an 87 percent rise in your share price in just 3 months make you a laggard? The answer: When your name is online travel agent Qunar (Nasdaq: QUNR), and the 87 percent rise makes you the worst performer among a quartet of Chinese Internet companies to make New York IPOs at the end of last year. The sudden surge in investor interest towards these companies will almost certainly lead many Chinese Internet firms to speed up their New York listing plans in the first quarter of this year, starting off with word that Tuniu, another online travel services firm, is accelerating its plans for a listing in the next few months. Read Full Post…
