Thursday, November 22, 2001

Cheap Tickets seeks
incentives to keep
operation in Hawaii

Star-Bulletin Staff

Local officials are trying to fend off other cities that would like to see Cheap Tickets relocate its 200-person Hawaii call center, with all sides offering tax, training and land incentives.

"There are a number of attractive incentives out there," said Cheap Tickets spokeswoman Dawn Soper Lyon. She declined to say who else is wooing Cheap Tickets, or what the offers were.

In October, New York travel industry giant Cendant Corp. completed its purchase of Cheap Tickets for $280 million in cash. In late September, Cheap Tickets said it was cutting 81 of its 367 Hawaii workers because the positions were duplicated on the mainland.

In the past few months, Cendant began negotiating with state and local officials for potential incentives, Lyon said. Depending on the final deal the firm receives, Cheap Tickets could even expand its operations in Hawaii, she said.

"This is all part of a comprehensive package," Lyon said. "I'd say we're making progress."

Joe Blanco, executive assistant to Gov. Ben Cayetano and one of the state's negotiators, could not be reached for comment.

Cheap Tickets was founded in Honolulu in 1986. The firm wants to stay in Hawaii, but has to look at all the factors, including cost of operations, Lyon said.

The firm has been working with the nonprofit economic development board Enterprise Honolulu to help recruit workers to fill 30 new job openings in Hawaii, she noted.

The Honolulu call center is one of four call centers used by Cheap Tickets to field phone calls from customers. Other centers are located in Los Angeles; Lake Port, Calif.; Colorado Springs, Colo.; and Tampa, Fla. All told, Cendant has about 30 call centers in the United States, Canada, Ireland, England, Mexico City and Singapore, according to the firm's 2000 annual report.

Cendant, franchiser of Ramada hotels and owner of Avis rental cars, recently cut 6,000 jobs, about 10 percent of its work force, because of a drop in tourism, according to Bloomberg News.

The firm's net income fell slightly in the third quarter to $210 million from $214 million a year earlier.

On Tuesday, Cendant sold $1 billion in convertible notes to pay existing debt.

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