DOT is considering outlawing travel agents "incentive f

A forum to discuss all aviation items (not for latest aviation news and military aviation news)

Moderator: Latest news team

Post Reply
SN30952
Posts: 7128
Joined: 31 Jul 2003, 00:00

DOT is considering outlawing travel agents "incentive f

Post by SN30952 »

The Department of Transportation is considering outlawing "incentive fees" that computer-reservation systems pay to encourage agents to use their networks.
The DOT considers those fees anti-competitive, and getting rid of them could shift more money to airlines.

But travel agents, already on the endangered species list of occupations, fear the loss of that revenue will hasten their demise. The government hopes to prop up suffering airlines at the expense of another profession - travel agents.
There are about 200,000 travel agents in the US, but their numbers are threatened by Internet sites and economic woes. Incentive fees often help the agents make ends meet.

Computer-reservation systems, or CRSs, are very competitive, because they battle each other - with fees as a weapon - to lure more customers.

Eliminating fees would also lower costs for booking services the airlines own, such as Orbitz.
No one opposes the DOT rules more than the CRSs themselves, which fear losing travel agents and any competitive leverage they have to get clients to use their networks.

One of the largest CRSs, Sabre Holdings Corp., said the new rules could end up raising customer fees.
While other industries were being deregulated, travel agents and airlines were facing more rules. "It's inconsistent with the Bush administration's policy," said Bruce Charendoff, Sabre's senior vice president for government affairs.

In the 1980s, 90 percent of all flights were booked by CRSs. Today, it's only 53 percent..

Post Reply