Even as Airbnb doubles down on China, Chinese unicorn Tujia widens the war to Asia

Chinese tourist using Alipay in Japan’s Kansai International Airport. Photo credit: Ant Financial.

Airbnb is doubling down on China this year, where it has been slow to expand. But it faces a strong rival there – Chinese unicorn Tujia which lists over 400,000 properties, five times that of Airbnb which is confined mostly to major cities.

In the first part of this series, we looked at why Airbnb struggles in China, and how Tujia altered the classic Airbnb model to dominate the Chinese market for alternative travel accommodation. Today, we zoom out to see how Tujia is now widening the war with Airbnb across Asia.

Surge of tourists from China

The secret to Tujia’s international aspirations lies in the throngs of Chinese tourists traveling abroad. China now leads the world in outbound tourism, thanks to economic growth and rise in spending power. Passports became much easier to get too, as China started trading with the world.

Last year, 135 million Chinese travelers went abroad and spent US$261 billion.

Last year, 135 million Chinese travelers went abroad and spent US$261 billion. Tujia targets those among them who like to go on vacations to tourist destinations adjacent to China.

“We see that as a huge opportunity for us, because what we do is suited for people going on vacation, where they stay at one location for multiple days,” Tujia president Hai Zhuang explains.

Tujia president Hai Zhuang. Photo credit: Tujia.

For extended stays, it’s nice to have a kitchen, washing machine, and some extra space, instead of being cooped up in a hotel room. “I have two daughters. It’s not possible for my family to fit into a hotel room. When I travel with my family outside, it’s usually Airbnb, and inside China, it’s Tujia,” says Hai.

But soon, Hai won’t need Airbnb except when he goes West. His company is busy lining up properties for Chinese vacationers to stay in Japan, South Korea, and popular destinations across Southeast Asia.

These include both shared accommodation a la Airbnb as well as the model Tujia has found works better in China, where most people are not so comfortable letting strangers into their homes. The Chinese company has become adept at providing travelers with short-term rentals of apartments or villas, which could be little-used second homes, unoccupied properties bought for investment, or even new properties from real estate developers.

See: How Tujia altered the Airbnb model in China – and why Airbnb hasn’t adapted

Tujia’s adaptability

The nature of the accommodation depends on local regulations, too. For example, it’s illegal to rent out a room or apartment for less than six months in Singapore, although you do find many listed on Airbnb. The local authority is considering a proposal to allow short-term rentals for some types of properties.

Regional variations