Core Viewpoint - Alibaba Group's CEO announced a strategic shift, integrating Ele.me and Fliggy into Alibaba's China e-commerce business group to enhance collaboration and target the local lifestyle service market valued at 35 trillion yuan [1][10]. Group 1: Company Overview - Fliggy, originally Taobao Travel, was established in 2010 and has undergone several rebranding and management changes, including becoming an independent brand in 2014 and rebranding to Fliggy in 2016 [2][4]. - The frequent changes in leadership have led to a decline in Fliggy's market position and user base, with a significant drop in users reported in 2024 [5][6]. Group 2: Strategic Integration - The integration of Fliggy into Alibaba's e-commerce group aims to leverage Alibaba's vast user base and resources to enhance Fliggy's competitive position against rivals like Meituan and JD [8][11]. - This move is seen as a response to the increasing competition in the online travel market and a shift towards a more centralized management approach within Alibaba [10][12]. Group 3: Market Potential - The local lifestyle service market in China is projected to grow from 19.5 trillion yuan in 2020 to 35.3 trillion yuan by 2025, with an increase in online penetration from 24.3% to 30.8% [13]. - Fliggy's role is expected to connect various service entry points, providing high-quality travel services to consumers [13]. Group 4: Future Outlook - Analysts suggest that if Fliggy can effectively utilize Alibaba's resources and improve internal coordination, it has significant growth potential, potentially greater than if it remained independent [13][14]. - The merger is anticipated to enhance Fliggy's operational efficiency, reduce costs through supply chain integration, and improve user experience by leveraging Alibaba's established customer service systems [14].