28 August 2009

Flight Centre says life is better without SQ

SYDNEY - Flight Centre managing director Graham Turner has been telling Business Spectator's Robert Gottliebsen and Stephen Bartholomeusz about the outlook for the travel retailer in the wake of its 70 percent fall in profits.

Turner also spoke about the fall-out with Singapore Airlines which has seen Flight Centre steer customers away from SQ in retaliation for the airlineââ¬â¢s decision to limit commission payments to Flight Centre.

Turner told Business Spectator that Flight Centre was not suffering as a result of its decision to switch customers to other airlines. Quite the contrary.

"The reality of that situation was that I think Singapore had some sort of a view that their customers were owned by them and that whether we supported them or not, they would still want to fly with Singapore and we have shown thatââ¬â¢s clearly wrong," Turner said.

ââ¬ÅâœTheir market shareââ¬â¢s gone down considerably. Weââ¬â¢re 70 per cent down on them, but we switched our business over to other carriers and the reality is that these days, whether youââ¬â¢re Qantas, Etihad or Emirates or Singapore, there are very good alternative products.

ââ¬ÅâœMost customers, particularly our leisure customer base, just want the best arrangements and thatââ¬â¢s why they use a travel agent to get advice on whatââ¬â¢s a good value proposition for them

ââ¬ÅâœSince we took that action against Singapore by not signing a preferred arrangement with them, itââ¬â¢s made it a lot easier to conclude our arrangements with other carriers and this is a volatile market.

ââ¬ÅâœSo our main point with Singapore and others is that we wanted fixed margins, not margins that were incentivised on volume in a market where fare yields and the like were very volatile.

ââ¬ÅâœIt was very hard to know whether theyââ¬â¢d continue to decrease, so we just didnââ¬â¢t want that level of volatility in our earnings for this year.ââ¬~

Read the full interview with Graham Turner at www.businessspectator.com.au

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• A load of rubbish
  
  

  What a load of rubbish, I organise all my own travel via the internet and I don't need Flight Centre to tell me about value propositions. I can get far better deals than FC will ever give me. I went once to FC and the quote I got from them was hundreds of dollars higher than other travel agents and almost a $1000 more than I could get on the net. This guy lives in fairy land.

  By John Heath, Wednesday, September 2, 2009
• SQ faces Total Ban by Indian Travel Agents
  
  

  I dont know if you are aware all travel Agent associations in India have banned its members from selling SQ tickets in India due Zero percent commission move adopted by SQ in India , and I believe SQ sale is down by over 80%. I guess the airines need to understand that the agent has to be paid renumeration for promoting and selling airline tickets, And they cannot ignore this powerful distribution mode

  By Sunil Bijlani, Friday, August 28, 2009
• Flight Centre-laughable
  
  

  Flight centre are showing their silly QLD parochialism. The more Turner sprouts on about how good things are without SQ the more we know the company is being damaged. I have moved my business away from FCM and Flight Cntre. You can't not offer the #1 Airline in the world and expect to retain business. Get your head out of the 80's Turner, Australia has grown up since then. Well that's what i tought!

  By Rob Willett, Friday, August 28, 2009
• In your dreams Skroo
  
  

  I have never seen a tail wag a dog !!!

  By johncook, Friday, August 28, 2009