CHINESE online search giant Baidu has made inroads into the emerging travel search market in China with its purchase of local travel search engine Qunar.
Founded in 2005, Qunar enables Chinese consumers to make real-time searches for domestic air and rail tickets, hotels, as well as tour packages. The meta search engine also provides travel-related resources such as user discussion forums and group buying deals.
Baidu has agreed to invest US$306 million in Qunar, as it seeks to reap a share of the lucrative Chinese online travel sector. The investment will make Baidu the majority shareholder of Qunar.
After the investment is finalised in the third quarter of 2011, Qunar is expected to continue operating as an independent company, although both Baidu and Qunar will cooperate in certain areas of online travel search.
Baidu’s decision to acquire Qunar is being seen as a smart move, which will synergise and enhance the capabilities of both companies to capitalise upon the growth opportunities in the Chinese travel search arena.
Online travel transactions in China are increasing at an astronomical rate as the Chinese appetite for overseas holidays grows. According to internet market research company eMarketer, the Chinese spent US$15.4 billion on online travel bookings in 2011, up from just US$1.5 billion in 2006.