Tour firm's isle pricing creates stir

One rival says the West Coast-Hawaii deals are priced below costs

By Russ Lynch
Star-Bulletin

A newcomer in West Coast-Hawaii tourism is offering package tours to the islands at prices so low that one competitor says the company must be selling below what it costs for the service.

Not so, says the company's marketing chief, Lauren Southam. Her company, Sunquest Holidays, is able to sell so low because its parent owns a fleet of airplanes and has huge buying power.

Sunquest, based in Simi Valley, Calif., outside Los Angeles, is part of Airtours, a British-based company that claims the ranking of the largest leisure travel organization in the world, said Southam, vice president of sales and marketing at Sunquest.

Airtours owns 32 aircraft, including the 380-seat DC-10 it uses in the Hawaii service, as well as three cruise ships and 41 hotels and employs 14,000 people around the world, according to the company.

The prices that have the rest of the industry taking notice include these deals, advertised in last Sunday's Los Angeles Times:

Seven nights, eight days, in Waikiki, including hotel room, round-trip air fare from Los Angeles and transportation to and from Honolulu Airport, for $299 a person.

Seven nights, eight days, in Waikiki for four people - parents and two children up to the age of 17 - for $1,487. Air fare is included.

Eight days on Maui for a family of four for $1,667, including air fare.

Hotels included in the packages are the Hawaiian Monarch, Marc Suites Hawaii, the newly refurbished Outrigger Islander Waikiki and the Aston Maui Lu.

Sunquest said the cheapest deals have a narrow booking opportunity, require mid-week travel and have other restrictions such as double occupancy, and they also can incur additional airport charges.

Sunquest was formed late last year and launched its first Hawaii trips in April.

Pleasant Hawaiian Holidays, which pioneered West Coast-Hawaii packaged vacations in the 1950s and is still the biggest in the business, last weekend advertised a Waikiki eight-day stay for $399 a person.

Ken Phillips, a spokesman for Westlake Village, Calif.-based Pleasant Hawaiian, said Sunquest is clearly aiming at the low end of the market.

"That's pretty much all the business they're going after," he said. "That's a good part of our business (too) but we're selling more in the mid to upper ranges these days."

Phillips said pricing depends heavily on what the airlines are doing.

"We have been known to change prices on a daily basis," he said.

The charge of selling below cost came from Ed Jackson, whose San Francisco-based Runaway Tours is another major Hawaii tour packager.

"It's very clear they're selling below their air and their hotel costs," Jackson. He said Sunquest is waging the same war in the Mexico market.

"The consumer's benefiting with some excellent values to both destinations," Jackson said.

One reason there is a price war going on, he said, is that reservations phone lines haven't been busy lately.

For the past year travelers to Hawaii have enjoyed some of the lowest fares ever, he said. Run

away Tours' business, however, has been nicely ahead of last year's until just the past two weeks, Jackson said.

Sunquest's Southam said Sun Country, the sister company that provides the aircraft, has air-travel-only Hawaii tickets for $199 per round trip. That is in line with the packages others offer, she said.

"Our flights are doing very well. The summer looks very strong for us and we're even booking Christmas," she said.