American’s new ticketing push could mean higher prices
Business travelers are not happy about the feud between American Airlines and travel web sites such as Orbitz and Expedia. The reason: they fear higher ticket prices.
At the heart of the quarrel is a complicated revenue-sharing arrangement between the airline, the travel website and the global distribution systems that dole out ticket information.
The bottom line is that American wants travelers to buy directly from its web site, where they will be encouraged to buy seat upgrades and extra goodies such as lounge access and fast check-in services, reports the LA Times. Industry analysts expect other airlines to follow American’s example.
But nearly 90 percent of business travel managers expect higher travel costs if that shift occurs throughout the airline industry, according to a poll of 244 travel managers conducted by the Global Business Travel Assn., a trade group for travel professionals.
Travel managers say the current online ticketing system makes it easier to compare prices and negotiate rates.
"Business travel buyers have spoken, and they overwhelmingly indicate that the ‘direct connect’ approach for airfare distribution is a pricey strategy that will result in higher costs for companies," said Mike McCormick, executive director of the association.
American Airlines disagrees, saying travel costs will go down if airlines eliminate the online distribution systems that act as middlemen.
Said airline spokesman Ryan Mikolasik:
"The current system already adds unnecessary costs to the business travel industry as a whole."
By David Wilkening
David
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