Priceline to unveil second Asian site

But when the Singapore business launches next week, the travel e-tailer will have to do without the participation of two major regional airlines.

2 min read
Priceline.com is set to kick off its second travel auction site in Asia, despite being snubbed by two major regional airlines.

The Norwalk, Conn.-based company is expected to launch its online business in Singapore next week, offering name-your-own-price airline tickets and hotel rooms to travelers flying out of the country.

The Singapore debut Wednesday comes one month after the start of Priceline's Hong Kong operations, which signed deals with 25 airlines and 8,000 hotels worldwide to sell their excess capacity on Priceline.

However, the auction site operator could not attract Cathay Pacific Airways, which is responsible for the bulk of Hong Kong departures. Singapore's largest airline, Singapore Airlines, is also not listed among Priceline's partners.

Explaining its nonparticipation, a Singapore Airlines representative said the airline's existing sales and distribution channels are meeting its needs. However, Singapore Airlines did not rule out the possibility of working with Priceline, saying it is keeping the option "under review."

Priceline, which said Thursday that its second-quarter financial results are on track, is looking to expand deeper internationally. In the United States, Priceline increasingly faces competition from rivals such as Hotwire, Expedia, Travelocity.com and Orbitz.

Priceline reiterated that its second-quarter revenue will be between $320 million and $350 million with pro forma earnings of 3 cents a share to 5 cents a share. For the year, Priceline is targeting pro forma earnings of 12 cents a share.

GartnerG2 Research Director Lane Leskela said that carriers in Singapore have adopted a wait-and-see approach. "Cathay Pacific and Singapore Airlines have plenty of distribution channels," Leskela said.

"Being dominant carriers, they have no reason to be overly concerned about excess inventory--which they constantly offer on discounts through their own Web sites. They are perfectly happy to continue doing that," he added.

However, this does not mean failure for Priceline's Asian ventures, Leskela said. "Customers will continue to shop around to compare prices, both online and offline, and go for the best deals."

Priceline's Asian business is operated by Hutchison-Priceline, its joint venture with Hong Kong conglomerates Hutchison Whampoa and Cheung Kong. Hutchison-Priceline says it helps travelers save up to 30 percent off average market rates. Its airline partners include British Airways, Virgin Atlantic, Air China, Continental Airlines, Northwest Airlines, United Airlines and Korean Air.

Hutchison-Priceline had earlier revealed plans to launch a Web site for Taiwan later this year.

CNETAsia's Irene Tham reported from Singapore.