Skift Take
The moves that Priceline and Expedia have made in the past week in China will ultimately be mere footnotes in the fluid and hyper-growth Chinese travel market.
In the rough and tumble China travel market, what Expedia Inc. CEO Dara Khosrowshahi refers to as the "wild, wild East," U.S.-based online travel agencies are measuring up each other and the market itself as they grapple to craft viable long-term strategies in what soon will be the world's largest travel market.
Likewise, Chinese online travel agencies, including Ctrip, are playing the field when it comes to international partners, hedging their bets and playing off one against the other.
In moves over the last few days:
The Priceline Group announced May 26 that invested $250 million in China's Ctrip, in addition to the roughly $500 million it injected last year, upping its stake in Ctrip to 10.5 percent. Priceline got the right through its initial investment last year and indeed named an observer to the Ctrip board. With the latest investment round Priceline also gets the opportunity to increase its share of Ctrip to 15 percent of its outstanding shares.
Expedia last week sold its controlling stake of money-losing Chinese online travel agency eLong to Ctrip. For the $400 million that Ctrip chipped in as part of the transaction, it gets a a 37.6 percent stake of eLong.
As part of the Expedia sale of eLong to Ctrip and other investors, Ctrip and Expedia agreed to cooperate in building vacation packages to China and other markets.
Expedia's Confounding Moves in China
On the face of it, Expedia's move to sell its largest footprint in China
