Online travel firm Tuniu seeks a cut in outbound travel above rivals
Investors have so far appeared to be willing to throw in more capital into China's online tourism market. According to research agency Analysys, the travel industry tends to see rapid growth after per capita GDP reaches 6,000 dollars.
China hit that target in 2013 and growth of its online travel market has since accelerated to 40 to 50 percent each year. Per capita GDP rose to 8,016 dollars in 2015 for the whole country and has shot up over 10,000 dollars in top-tier cities, leading to increasingly diversified demands for travel services beyond organized tours, and hotel and transportation bookings.Though Ctrip and Qunar hold a roughly 75 percent combined share of China's hotel and air ticket online booking market, Tuniu seeks to cut through their dominance by beefing up outbound leisure travel services that range from trip itineraries, car rentals to attraction tickets and restaurants reservations.
Such a strategy has seen the company increase procurement from travel wholesalers, buying travel agencies to expand market share, working with car rental firms, attractions and other service providers, and building up service centers both in China and popular foreign destinations.
Investors ranging from China's HNA Tourism Group, e-commerce giant JD.com to overseas funds DCM, Temasek and Sequoia Capital have committed to a fresh round of funding totalling 1 billion dollars for Tuniu over the past year to support such business expansion.
When it comes to outbound travel, Yan said, China has a rich, varied market. People from the top-tier cities are transitioning from sightseeing to leisure travel.
