AIRASIA and Expedia are scheduled to combine their inventories by end of this month, some 11 months after coming together in a 50:50 joint venture (TTG Asia e-Daily, March 29, 2011), but have so far failed to convince the rest of the travel trade community of the viability of their partnership.
Dan Lynn, CEO of AAE Travel, the subsidiary formed as part of the joint venture, said: “So far, the joint venture has brought a lot of synergy. We’ve learnt tonnes by bringing together our experiences. It is a symbiotic relationship that has brought incremental value to both our brands. It has made both companies far nimbler.”
However, tourism players whom TTG Asia e-Daily spoke to begged to differ.
Dennis van Noord, area manager distribution Asia, Booking.com, said: “Expedia probably stands to gain more from the joint venture rather than AirAsia in the long run. Expedia has been able to piggyback on AirAsia’s strong branding in Asia. AirAsia has on the other hand, by tying itself exclusively to Expedia as a third party distributor, actually restricted its inventory to a certain degree.”
Franz Nitz, director partner development, Agoda.com, added: “Both Expedia and AirAsia should focus on what each of them do best. I do not see the logic in the joint venture and I have no idea where it is going.”
Steven Greenway, head of commercial, Scoot, explained that airlines were wary about having any business dealings with AAE Travel since it might put sensitive customer data into AirAsia’s hands.
“This certainly puts Expedia at a disadvantage, as it would be more difficult to convince airlines to have tie-ups with them – which I believe forms a core part of their expansion strategy,” he said.
Mark van Ogtrop, managing director, Golden Tulip South-east Asia, agreed. “There is certainly a conflict of interest between the two, especially since Expedia also sells other airline products,” he said.
Scoot’s Greenway summed up the general sentiment: “The jury is still out, but a lot of equity is involved, and it would be difficult to turn back now.”
