14 November 2008

Businesses wasting money on ââ¬Ëœsweetheartââ¬â¢ deals with airlines

Easyjet is cheaper than alternative carriers on the busiest European routes the majority of the time, according to a new poll.

The survey found the budget carrier was less expensive 79% of the time and that companies save over Ã&#pound;100 on at least 35% of journeys.

But it also found that companies are ignoring their own rules and are wasting money by only booking Easyjet for 10% of journeys. 

According to previous research, more than a third of companies adopt a ââ¬Åâœlowest logical fareââ¬~ policy for European short haul travel.

Therefore, it is clear that these policies are not being enforced fully, the airline claimed.

Easyjet commissioned ITM Research to conduct the independent price comparison study of business travellers. 

The analysis involved Institute of Travel Management corporate members within the South East that primarily flew from the four London airports.

The study was conducted on a random sample of 300 booked itineraries over a three month period between June and August and covered a basket of return fares across 22 European and UK routes from London.  

The analysis included any negotiated fares with traditional airlines compared with the base Easyjet price plus speedy boarding and applicable fees and taxes.

The research also showed that when it came to UK domestic travel, the frequency of Easyjet schedules meant that on 90% of occasions it was shown to offer a cheaper alternative itinerary to the flight booked.

The airlineââ¬â¢s UK regional general manager David Osborne said: ââ¬ÅâœOnce again easyJet debunks the myth that special sweetheart deals negotiated with the legacy airlines provide value for money ââ¬' they donââ¬â¢t. 

ââ¬ÅâœThey just produce a fare that is slightly less expensive than it was to start with.

ââ¬ÅâœEasyjet has tailored its products and services for the business traveller, with frequent flights to major business airports and not out of town airfields. 

ââ¬ÅâœWe are now available on the GDSs and self-booking tools and we encourage TMCs and business travel agencies to promote our proven low fares with care and convenience to their customers.ââ¬~ 

ITM chief executive Paul Tilstone added: ââ¬ÅâœWhen Easyjet engaged with the GDSs they also entered into consultation with ITM and others about additional fees corporate buyers would incur. 

ââ¬ÅâœITM challenged Easyjet on their suggestion that the fee impact was minimal as they were the cheaper option for business travellers on most occasions. 

ââ¬ÅâœThe airline subsequently commissioned ITM Research to undertake an independent study to test this. 

ââ¬ÅâœThe robust analysis was undertaken across hundreds of real-time trips and demonstrated that whilst small GDS fees have been added to fares, the bigger picture shows the airlineââ¬â¢s new model does indeed offer a cost reduction opportunity for travel buyers.ââ¬~ 

by Phil Davies 

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