Ctrip will fully integrate eHi Car Services into its platforms making eHi’s services available on Ctrip’s marketing channels including the website, mobile app and offline channels.
Ctrip and eHi’s partnership started with Ctrip investing US$94.05 million to become eHi’s second largest shareholder in December 2013. It followed up with an additional US$13.02 million investment in April 2014, making Ctrip the largest shareholder of eHi with 23% stake.
The partnership is a win-win for both, opening up business channels that help Ctrip provide solutions for its users' hotel and ticketing needs and take eHi's operation to the finish line. The partnership delivers a platform, a sponsor and a customer base to eHi, and a one-stop-shop solution from ground transport to air tickets and accommodation to Ctrip.
Ctrip strives for a transformation as the growth for the OTA model slows down. The heavy discounting war against arch foe Qunar has drawn in customers but the litmus test for retaining those new users lies in the service experience. To do this Ctrip CEO James Liang has always advocated fragmentation and individualization of travel services, in contrast to Qunar and Baidu’s standardization and mega-data strategies.
Besides eHi, Ctrip has expanded its supply chain and offerings by working with international car rental Avis and investing in local P2P car share Yongche, as well as taking strategic holdings in travel journal app Chanyouji and acquiring Quick Hotel.
Mr. Liang dubbed 2014 its “Investment Year” and the investment binge is showing no sign of letting up so far. After all he has always believed in putting all in before the second ice age that he predicted will strike the online industry. Ctrip must now speed up the processing of its investments in order to reap the benefits of the synergy of those resources.(Translation by David)
