Travelocity shuts down India site as operating costs rise

It appears that Travelocity has pulled the plug on its India specific website Travelocity.co.in: the site currently informs visitors that “This India-specific site is not operational anymore; however we are re-directing you to our global site, Travelocity.com where you will find all the options you may be looking for!”

Travelocity India was launched in 2007, and initially focused on booking hotels.

Looks like this change is just being implemented, because the redirect doesn’t work, and on visiting Travelocity.com, those from Indian IP Addresses are still asked to choose between the India site (which doesn’t work) and the global site. The tickets on the global sites are priced in USD, and we’re not sure of the payment gateways that are in use allow bookings in Indian Rupees.

Remember that Travlocity sold online hotel aggregator TravelGuru to Yatra.com last year, three years after acquiring it.

The online travel sector in India is facing significant issues: with convenience fees having gone up, because airlines were passing on card processing fees to the customers, and following this, the Supreme Court of India directed airlines not to charge transaction fees, which would impact OTA margins because the cost reverts back to the airlines.

MakeMyTrip has just reported a $5.23M loss ($2.52 million adjusted net loss) for the quarter ending December 31st 2012, largely owing to a reduction in airline commission.

The story first appeared on Medianama, reprinted with permission.