Thursday, 23 September 2010

Airlines must show extras - pressure builds

A huge head of steam is building up to persuade airlines to show extra charges on travel agents' booking screens. It's easy to see why. Figures out today show Ryanair earned 22.2% of its revenue last year from baggage and other charges - and easyJet earned 19.4%.

The problem is that although you can see those extra fairly quickly if you book on line, High Street travel agents find it more difficult. The aforementioned revenue percentages come from a report by Amadeus, one the major Global Distribution Systems which provide agents with the terminals used for booking.

So far pressure for change has built mainly in the US, where a couple of carriers earn even bigger proportions of their income from ancillary charges.

Many people in the travel business accept that the relatively new practice of "unbundling" - charging a fare for the basic flight and charging extra for anything from check in at the desk to in flight meals - is helping airlines survive in a hostile economic environment

Today the American Society of Travel Agents and the and Business Travel Coalition presented Secretary of Transportation Ray LaHood with a letter signed by more than 300 of the world’s largest agents, companies and travel management companies and corporations and by travel associations urging him "to require airlines to fully disclose ancillary fees to all sales outlets in which they participate". Included among the signatories were companies such as McDonald’s, Wal-Mart, Merck, Deltek, BASF, Goodrich, Ingersoll Rand, GlaxoSmithKline and Campbell Soup.

Expect that pressure to increase on this side of the Atlantic, too.

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