BY JENNIFER DORSEY
PARSIPPANY, N.J. -- HFS Inc. said it combined three previously
independent travel services operations into a new unit called the
HFS Travel Group in a bid to reduce costs and enhance
cross-marketing opportunities.
The new unit includes Resort Condominiums International Travel,
which provides travel services to RCI's time-share members;
Preferred Holidays, a tour subsidiary of Avis, and HFS Corporate
Travel, an in-house corporate travel department.
Michael Monaco, HFS vice chairman and chief financial officer,
said, "HFS will achieve economies of scale as well as increase
cross-marketing of the company's many travel-related products and
services to time-share exchange members, Avis customers, real
estate and hospitality division franchisees as well as all our
employees."
Frank Terranova, previously vice president and general manager
at Preferred Holidays, was named president of HFS Travel Group.
HFS Travel Group has 450 employees and is based in Indianapolis,
Resort Condominiums' hometown.
Terranova said one goal of HFS Travel Group will be to
capitalize on "synergies" among various HFS units, including its
various hotel brands, Preferred Holidays, RCI, Avis and Value
Rent-A-Car, which is being acquired by HFS, as well.
In that respect, HFS will continue acting as a wholesale
operation selling products through travel agents.
RCI, for example, has an estimated 120,000 weeks of unsold
condominium inventory, which is packaged with rental car options
and sold by Preferred Holidays through travel agents.
Another example of cross-marketing is the Preferred Holidays See
America program, a line of fly one-way/drive one-way packages.
The program uses Avis rental cars, reducing Avis' costs in the
seasonal movement of vehicles.
It offers such HFS hotel brands as Ramada, Howard Johnson's
Super 8, Park Inn and Days Inn as the lodging options.
Another function of HFS Travel Group will be as in-house
provider of corporate travel services to employees of HFS and its
various subsidiaries, including Avis and the real estate brokerage
and hotel companies.
These employees will be required to make their arrangements
through the new unit, marking HFS' first company-wide corporate
travel consolidation.
Terranova estimated the corporate travel volume to be booked
through the Travel Group this year at $27 million.
HFS at the end of this month will stop using World Travel
Partners, based in Atlanta, to handle travel for employees at its
headquarters, which accounts for about $9 million annually.
HFS Travel Group already has Airlines Reporting Corp.
accreditation through Resort Condominiums International Travel and
Preferred Holidays, Terranova said.
Terranova emphasized that this will be strictly an in-house
operation, saying, "It is not our intention at all to be a
corporate travel provider in the industry."
The Travel Group also will be linked to other HFS reservations
facilities to provide backup support on a seasonal basis.
It will pick up car rental and hotel reservations during peak
summer periods, for example, when leisure tour wholesale
reservations activity typically declines, HFS said.