Travelocity, one of the big three US online travel agencies, said yesterday it was to expand aggressively in Europe this year as it seeks a foothold in less-developed travel e-commerce markets.

\"We\'re always looking for acquisitions and Europe is particularly important. There\'s an investment mood over there,\" Michelle Peluso, chief executive, said. \"Online penetration is low but the market is large and growing fast. Europe is years behind the US.\"

Travelocity is engaged in fierce competition with rivals Expedia and Orbitz to reclaim marketshare, while increasing higher-margin businesses such as vacation packages and hotels. US online travel companies are expanding overseas to stake an early claim to new markets.

Last month Travelocity purchased travelchannel.de, a German online travel group, and also this year it bought Boomerang Voyages, a cruise operator based in Paris. Terms of the deal were not disclosed.

Travelocity\'s European operations include businesses in the UK, Germany, France and Sweden, with the UK market as \"especially compelling\".

Ms Peluso noted that getting into the European market required a slightly different tack because the \"pre-packaged market is very popular\" in contrast to the US, where more independent travel is booked.

Europeans tend to favour holiday packages offered by agents and tour operators. \"We need to educate consumers about travel opportunities that allow them to put vacations together themselves, that there can be more flexibility in doing it yourself,\" Ms Peluso said.

Source| news.ft.com