CTS HK Group Fostering National Brands

At the beginning of 2009, China National Travel Service Group Corporation announced a rebuilding plan for its hotel properties. In June 2007, the former CTS Group and CTS HK Group merged to build up one of the largest domestic tourism groups — CTS HK Group — and later in November 2008, the group launched its restructuring of Travel Agency properties all over China.

The hotel properties restructure plan is another major action of the group, indicating its ambitions of building up a much stronger sub-industry. The general manager of CTS HK Hotels Company, Elton Sun explained the detailed contents of this restructuring plan to China Hospitality News.

Sun said that as a key part of the merger of the two large groups — CTS HK Metropark Hotels Management Company and CTS Hotel Corporation — a brand new company CTS HK Hotel Company Ltd. will be set up. The new company would act as a professional hotel operating company, under the CTS HK Group's strong centralized leadership. Furthermore, the new company would be authorized with full executive rights in areas including hotel operation, management, investment, and recruitment.

After this merger, CTS HK Hotel aims at growing in size and distribution. To date it operates 50 hotel properties with more than 15,000 guestrooms. Its hotel assets have reached almost CNY10 billion, and with CTS HK Group's hotel assets' implantation, CTS HK Hotel will gradually cultivate the conditions for independently listing, and its capacity of investment and financing would be prepared for its rapid development and risk diversification in the future.

Sun emphasized that CTS HK Hotel will relocate its head office from Shenzhen to Beijing, and has set as its strategic objectives entering the top three groups in the domestic hotel industry, planning overseas layouts, implementing international development, and building a brand-rich large hotel group with domestic and international influence.

Sun told China Hospitality News that after the reorganization, CTS HK Hotel will adhere to the "three wheels rolling" and "development of three directions" strategy. The first wheel is to manage their owned hotel properties well, the second wheel is to manage output, and the third wheel is franchising, aiming at achieving quality-oriented development in the second-tier cities in developed areas and the national capital cities, achieving quantity-oriented development through integration and transformation of the hotel assets; and achieving integrated development via franchising some low-end hotels.

Sun finally said, CTS HK Hotel operates four hotel brands, namely: "Grand Metropark" for five-star luxury hotels; "Metropark" for four-star business hotels; "Traveler Inn" for characteristic business hotels and "Traveler Inn Express" for budget hotels. The current reorganization will build "one management platform and two brand series", and they plan to set up three flagship hotels in northern, eastern, and southern China, in Beijing, Shanghai, and Guangzhou or Shenzhen repectively before 2010. He explained the company's vision is to foster "Metropark" and "Traveler Inn" as characteristic representatives of Chinese hotel brands.