Online travel site Travelocity - one of the world's largest - has been acquired by Expedia, Inc. for $280 million cash, and industry observers in the Caribbean are as yet unsure how - if at all - the merger will affect Caribbean bookings. As of last year, Expedia's technology powered platforms for Travelocity's U.S. and Canadian websites along with its hotel supply and customer service programs, while Travelocity drove additional web traffic to Expedia.
Tom Klein, president and chief executive officer of Sabre - which owned Travelocity - explained the decision to sell Travelocity: He said Sabre's primary focus is "to provide mission-critical software solutions to our global airline, hospitality, and travel agency customers - and to help them support their customers every day."
"We have had a long and fruitful partnership with Expedia, most recently by partnering to strengthen the Travelocity business, so our decision to divest Travelocity is a logical next step for us both," Klein said.
Expedia, Inc. President and Chief Executive Officer Dara Khosrowshahi also spoke to the fit.
"The strategic marketing agreement we've had in place has been a marriage of Travelocity's strong brand with our best-in-class booking platform, supply base, and customer service. Evolving this relationship strengthens the Expedia Inc. family's ability to continue to innovate and deliver the very best travel experiences to the widest set of travelers, all over the world," Khosrowshahi said.
"Travelocity is one of the most recognized travel brands in North America, offering thousands of travel destinations to more than 20 million travelers per month," he added.
In addition to bookings, Travelocity also occasionally provided market data. For instance, last month the site revealed that warmer-weather destinations like The Bahamas were seeing a dramatic increase in bookings.
Travelocity reported a dramatic increase in planned visits to tropical destinations during the holiday season of 2014. While bookings for The Bahamas were up 50.2 percent over 2013, some destinations - the Cayman Islands up 96 percent, the Dominican Republic up 76 percent - were even further ahead.
The merger brings Travelocity into the Expedia portfolio along with Hotels.com, eLong, Hotwire, Trivago, CarRentals.com, Venere.com and Egencia. It also marks further consolidation in the online booking space, which has seen a number of acquisitions from Expedia Inc's main competitor, The Priceline Group, including its $2.6 billion takeover of restaurant reservation website OpenTable last year.
Travelers were barely impacted by the earlier Travelocity and Expedia partnership, and they aren't likely to notice any difference with the all out merger, say some analysts. Still, Khosrowshahi said, "Evolving this relationship strengthens the Expedia Inc family's ability to continue to innovate and deliver the very best travel experiences to the widest set of travelers, all over the world."
Launched in 1996 as a unit of Sabre Holdings, Travelocity was the first website that offered the ability to reserve and buy airline tickets without a travel agent. Travelocity quickly grew after partnering with AOL for its travel portal in 1999. However, Travelocity's growth rate has dwindled in recent years.
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