LY.com is setting up a joint venture company with Korea’s Lotte Tour in a strategic partnership to consolidate local Korean tourism resources and procurement.
Lotte Group is one of the largest Korean conglomerates
LY.com’s CEO Zhixiang Wu said : “China’s online tourism industry has already entered an era of competition in non-standardized products, so overseas vacation is the final frontier for us. Our partnership with Lotte Tour is an important step in developing non-standardized products such as overseas tours and luxury vacation and will help us strengthen our consolidation of overseas destinations resources, focus on service quality and build our word-of-mouth reputation.”
Lotte Tour’s parent company Lotte Group was established in 1948 and is one of the top five Korean chaebol (conglomerates). Its business spans food and beverages, logistics, tourism, finance, manufacturing, construction and heavy industry.
LY.com and Lotte Group got together in late August this year, and by October it had drafted a strategic investment JV proposal. The JV was eventually registered in the beginning of December.
LY.com has been mapping its overseas expansion recently, accessing Taiwan tour resources through the acquisition of Nantong Huihuang Travel and paving the way for expansion in Japan through setting up a JV with Japan’s second largest tour operator HIS.
LY.com, currently enjoying high volume of Korea-bound tours, is optimistic of the Korean market. Despite the MERS scare putting a dampener on inbound travel earlier this year, the destination bounced back quickly and bilateral tourism traffic maintain steady growth through mutual efforts of China and Korea. Statistics show that 3.29 million Koreans visited China from January to September, up 6.8% y-o-y. The total bilateral visitor traffic is expected to top 11 million trips this year.(Translation by David)
