20 Things You Didn’t Know About Hotwire

If you haven’t used Hotwire yet, you may be interested in knowing that it’s a travel website that can be useful in finding the best deals on vacation packages, rental cars, hotel rooms, airline tickets and more. It’s handy to use their services because you can access everything online from the comfort and convenience of your own home. We were checking into the company and here is what we learned some new and interesting things about them. Here are 20 things that you probably didn’t know about Hotwire.

1. They’ve been in business for 18 years

Hotwire was founded by Karl Peterson, Gregg Brockway, Eric Grosse and Spencer Rascoff in 2000. Although most of us have grown accustomed to hearing advertisements for their services, and it seems like they’ve been around forever, they’ve only been in operation for less than two decades. Of course, for some people, that is their entire life. The company is still going strong and isn’t showing any sign that they plan to go away any time soon.

2. Hotwire was also launched by several leading airlines

When we began checking into the history of Hotwire, we learned an interesting fact that we didn’t know before. In addition to the individuals who co-founded Hotwire, there were also six major airlines involved in its launch. The participants in this joint venture were America West, who changed their name to American, United, Continental, now United, American, and Northwest which is now Delta airlines. It’s understandable that these major players would become involved because Hotline offers a method for selling seats that are open on their flights for lower prices, but at least they’re making something on them.

3. They received private funding to become established and they had a code name

In the beginning, when Hotwire was first developed, there were a lot of expenses involved with the venture. It’s not cheap to set up an online travel service. It takes a lot of workers, building the infrastructure, purchasing the equipment, office supplies, web services, servers, storage and so forth. Initial funding for Hotwire was spearheaded by Texas Pacific Group which is a private equity firm. They made an investment of $75 million into the business under the code name Purple Demon.

4. Hotwire was sold in 2003

IAC/InterAcitive Corp was interested in purchasing Hotwire, which had become a valuable company by 2003. Within three years, it had grown in size and value and the corporation saw it as a good investment. The total cost for IAC’s acquisition of Hotwire.com was $663 million. The partners of IAC under the purchase agreement included Match.com, Entertainment.com, Evite, HSN, Lending Tree, Ticket Master, RealEstate.com, and CitySearch.

5. Hotwire received national accolades two years in a row

J.D. Power and Associates are known for producing survey data for a number of companies and services. Their ranking placed Hotwire in the lead for customer satisfaction. This was in its survey of Independent travel websites. It earned this distinction in both 2008 and 2009 for two consecutive years in a row.

6. Their first products were opaque airline tickets

When Hotwire first launched their travel services site, they only had one product to sell. They did well enough selling opaque airline tickets. Within a few months after their initial launch, they added opaque hotel accommodations. These were followed by rental cars. It wasn’t until 2003 that they started offering package deals to their customers. These are things that take time to orchestrate and to pull all of the participating partners together under legal agreements.

7. Hotwire stopped charging airfare booking fees

In 2007, Hotwire improved their services to customers. They had added a lot of new features and select retail travel products from 2004 through 2007. They were in a good position by 2007 and they removed all of their booking fees for airfare. We don’t think that it’s a coincidence that their customer satisfaction ratings soared over the following two years of business.

8. They’re owned by Expedia

This is a question that we saw commonly asked in our research of Hotwire. The answer to the question about whether or not they are owned by Expedia is yes. Expedia is a company that spun off from AIC. It is considered to be an operating company of its parent business, more formally known as the Expedia Group.

9. Hotwire is one of several travel sites owned by Expedia

Hotwire joins the list of popular travel sites that operate under the umbrella of the Expedia Group. They also operate Egencia, ClassicVacations.com, and Hotels.com. Although we do see a bit of an overlap in the services that are provided, they seem to be managing their portfolio of similar companies well.

10. Hotwire likes to deal exclusively with brand name travel companies

Hotwire avoids a lot of issues with customer service by dealing directly with brand name travel companies. This allows their partners to sell inventory that they probably would not have otherwise sold. In this industry, everything has a hard and fast expiration date and there is no reclaiming lost revenue. Hotwire is providing a valuable service to the brands that they offer in their packages and last minute reservations and bookings from the website.

11. The sales model that Hotwire uses is called “opaque”

From the day that Hotwire first began offering travel services to the general public, they have operated under the same business model. The opaque system requires that Hotwire keeps the name of their participating partners anonymous so this is information that they do not share with their customers. The partnering companies also deal with hotel rooms, airline seats, and rental cars that have not yet been sold and are approaching their expiration date. This is how customers are able to get such fantastic deals on them. It’s better for the end providers to make something rather than nothing on their travel products.

12. Hotwire does not participate in bidding wars

Some of the popular travel sites that offer amazing deals on open rooms, vehicle rentals and airline flights offer the reservations in a bidding or auction format. There are time limitations set and interested parties can place bids with the security of a credit card on these travel products. This is something that Hotwire has never participated in, nor do they plan to in the future. Their offers are straightforward and when customers go to make a reservation, they know upfront that they do not need to vie against other travelers to get a good deal.

13. The co-founders sere as management

Hotwire.com was founded by four men and a group of airline companies. Since its inception, Karl Peterson stepped up to the plate to serve as their first CEO. In 2006, Eric Grosse, who had served as the CFO for the company led the company. He became the president of Expedia Worldwide in 2009, moving up into the parent company. It was at this time that Clem Bason took his place with the Hotwire Group. Bason left in 2013 and handed the reigns over to Henrik Kjellberg who became President of hotwire.com. The headquarters for Hotwire is located in San Francisco, California.

14. Hotwire’s growth has been exponential

It’s actually quite impressive that a company that was started with just 4 employees grew within a few months to 80 employees. It has now expanded to employ a team of more than 300 workers. Their management team consists of six Vice presidents and one General Manager.

15. Not all customers are pleased with the quality of the rooms

When you’re making reservations through Hotwire.com you really need to do some of the legwork on your own. Check the reviews for the hotel because even though it may be rated with 4 stars, this doesn’t mean that they have a good reputation for service or amenities. You could blame hotwire for not fully investigating the allegations of quality made by the hotel, but they deal with a lot of different hotels and it’s impossible for their staff to verify each one and keep up on the ratings. It’s always smart to check the customer reviews on a hotel before you purchase a discounted ticket, even if it seems like a great deal.

16. It’s not easy to contact Hotwire.com staff by telephone

We’ve reviewed several customer comments which point to the fact that it can be hard to get ahold of a representative at Hotwire.com. Some have complained that they have had long waits on the telephone of up to 30 minutes before they could actually connect with a staff member to discuss their concerns.

17. Sometimes Hotwire leaves out important details

One customer shared her experience and related that she had purchased room reservations at a four-star hotel. Not only was the hotel below this standard, but she also discovered that there were extra fees that were added onto the nightly rate that she was being charged for. She had expected to pay a certain price but didn’t take into consideration that there would be extra fees prior to booking. It’s always important to check out the fine details when you’re using Hotwire or any other travel services website for that matter.

18. You are responsible for reading the fine print

Although Hotwire could easily include an extra line or two to warn people about additional fees, there are some things that they do tell you in the fine print. It’s up to you to read through all of the details thoroughly because the company is not responsible for any omissions on the part of the customer. For example, there are some hotels and resorts that have strict age limitations. Some require that all patrons who stay are at least age 21 or over. You can purchase your tickets through Hotwire.com but when you arrive at the room, if you have guests in your party under this age limit, they will not be allowed to stay even if you have already paid for the room.

19. You won’t get a refund

If you make reservations with Hotwire or with any other travel website for that matter and reserve a room or a seat aboard an airline flight, and you cancel or miss your flight, it’s not going to be refunded. This is one of the policies that you should become aware of before you decided to book a flight or reserve a room. It’s common with discounted travel products because these are offered to fill them as quickly as possible. Once you make the reservation and pay for the service, you’ve bought it whether you use it or not, so keep this in mind when you’re searching for great travel deals on the internet. This policy is not unique to Hotwire.com. Most of the online travel service providers set this stipulation. They have partners who are offering the deals to answer to as well. In essence, they’re a type of broker for other businesses who are selling their products.

20. Sometimes Hotwire.com is not your best solution

We’re not saying anything negative at all about Hotwire.com. They offer top quality services for their customers. Although there have been several complaints made, there are even more customers who are highly satisfied with the travel products and services that they provide. But there are circumstances when using an online travel site for discounted tickets may not be your best option. If your plans are tenuous and they are subject to change for circumstances that are beyond your control, then you may want to consider booking directly with the service provider. If there is a likelihood that you’ll need to cancel or reschedule a flight, a room reservation or a car rental, it’s best to go with a plan that ensures you have the options for doing so without losing everything you’ve already paid for the reservations. Sometimes saving a buck can end up costing you double in the long run.


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