Alibaba’s travel arm to report to CEO Daniel Zhang as e-commerce giant prepares it for greater freedom under restructuring: report

Alibaba Holding Group’s online travel booking platform Fliggy has come under the direct leadership of group chief executive Daniel Zhang Yong as part of a restructuring aimed at eventually freeing up different business units within the e-commerce giant, according to local media reports.

Zhuang Zhuoran, who took over as president of Fliggy in 2020, now reports to Zhang directly, according to local media outlet Cls.cn which cited unidentified sources, an indication that the travel arm is being prepared for greater independence in future as China’s tourism sector continues to recover.

Zhuang previously reported to Yu Yongfu, who heads Alibaba’s Local Consumer Services Group, one of the six major businesses targeted to become more independent under a sweeping restructuring plan announced by the e-commerce giant last month. The consumer services group includes online mapping service AliMap (Gaode), and food delivery services unit Ele.me.

Alibaba, JD.com restructure e-commerce units to spur growth in sluggish market

Alibaba, which owns the South China Morning Post, did not immediately respond to a request for comment.

Hangzhou-based Alibaba last month announced an unexpected breakdown of its business into a “1+6+N” formula that split the group into one holding company, six business groups and a group of other independent entities making up the N part. Fliggy has been marked under the “N” section of the formula amid the ongoing restructuring.

Zhang described the group restructuring as the “the most important organisational change in Alibaba’s 24 years [of history]”, saying that the split would help turn the tech giant into an agile organisation.

The online travel business will need much more latitude for strategic execution, according to Chen Liteng, a Hangzhou-based analyst focused on the online-to-offline services sector at market consultancy 100ec.cn. Putting it under “N” will enable the unit to better use resources for growth, said Chen.

“This, plus the tectonic change in the [online travel] sector resulting from the end of three years of pandemic controls [in China], has led to Alibaba setting higher expectations for Fliggy,” added Chen.

Other analysts said the move could also pose challenges for Fliggy.

Li Chendong, founder and chief analyst at e-commerce consultancy Dolphin, said Fliggy has to date been heavily reliant on supporting factors, such as capital and online traffic, from parent organisation Alibaba.

“Without its own source of traffic I think it will be challenging for it [Fliggy] to make progress,” he said.