Class action and Qantas’ demands set to trash QF relationship with agents.

With Qantas’ growth being secured by the flying kangaroo vehemently driving its massive cost slashing programme and the growth of Jetstar rather than growth in Qantas’ outbound business, it appears that the airline may have taken what Harvey World Travel agents described as “one step too fare”, by demanding that Stella Travel Services and all Harvey World Travel and Travelscene American Express agents withdraw from the fuel class action.

The agents’ rejection of the “threat” by Qantas is reported to have been massive with a landslide No and it is understood that Stellas’ Keith Stanley will be advising Qantas next week.

Agents who did want to be named fearing potential reprisals that could impact on their business, went on to explain, “Qantas” arrogance and lack of understanding of the distribution model in Australia is quite amazing and is set to be their downfall.”

While some other airlines including Singapore Airlines and Cathay Pacific have also waved the big stick, their threats have been nothing like Qantas’.

The agents added, “It is also interesting that QF’s May and July outbound passengers are down, yet the airline shows an increase in profit, which can only come from cost cutting, including slashing agent commission and staffing and the growth of Jetstar.”

The agents went on to say that if QF loses this fuel levy class action, case, they will merely continue to try and slash costs and even try to recover their legal cost from agents with they supposed more cutting of staff, which is now compromising the quality of their service and damaging their reputation, which quite frankly is already damaged, potentially beyond repair.

They added, “The amazing thing is that Qantas just don’t get it, in that 80% of their business comes through travel agents and yet they seem determined to trash this long standing relationship, upon which their business is founded and upon which their future depends.” “It’s a bit like Harvey Norman not allowing customers into their store!”

One said, “I wonder what the financial world would say and what impact it would have on Qantas’ share price if the markets and investors knew or actually really understood that Geoff Dixon and his team appear to be determined to trash the airline’s largest single source of business?” “I reckon a downward spiral in the share price would result!”

It also appears from comments from a large number of agents who received the letter from Stella’s Keith Stanley regarding Qantas’ threat or even what one might call “blackmail threat” that Stella pull out of the class action or lose commissions, overrides, etc has actually galvanised the agent community to potentially boycott Qantas, with a number already not offering the airline to their clients.

It also appears that Keith Stanley is considered to have taken a very sympathetic and balanced approach and as one agent told The Mole, “We think Keith is going to tell Qantas to stick it!”

He added, “Qantas already stinks with agents and they now seem determined to damage the relationship even further, even to the point of no return and hey good luck to them if that is what they want to do, but they have kind of forgotten that there are plenty of other airlines flying where they fly and not only they that, they pay good commission.”

One agent who agreed to be named, Gil McLauchlin, a long standing industry leader and owner of a number of Harvey World Travel agencies and other travel and travel media businesses told The Mole, “We think Qantas has gone too far this time and even though Tom Goldman, who I believe incorrectly said recently that we depend on our suppliers and we should not get Qantas offside, I think that Qantas has forgotten that the harsh reality is that we all depend on our customers and we are Qantas’ customers along with our customers.”

“If that means that we get better deals or are happier working with other airlines that demonstrate they value our business, with us and our clients as their customers then we will go with them.”

“There is no question that Qantas no longer values our support as agents in their business and as a result they do not deserve our support.”

“We love and value our customers and ensure they remain our customers, but Qantas clearly does not love or value us and most certainly appear to be doing everything they possibly can to ensure that we do not remain their customers!”

Other agents added, “There are other carriers that pay 9% on the ticket including the fuel surcharge so we intend to go with them and they are happy to work with us and easy to work with and Qantas is not.”

There is also a consensus in the industry that AFTA has been “bought” by the multiples and Qantas, deciding to sit on the sidelines with Mike Hatton, AFTA’s CEO appearing to have effectively been gagged by his Board which is interestingly dominated by the multiples.

AFTA Board members include, Mike Thompson: Travelscene American Express, Keith Stanley: Stella Travel Services, Mark Cari Stella Travel Services – Harvey World Travel Group, Michael Reed: Jetset Travelworld Group, Justin Morgan: American Express Business Travel, Graham Turner: Flight Centre Limited and Paul Scurrah currently AOT Holidays & AOT Retail.

There are also noises being made across the industry and in particular at agency level about the failure to act or become involved by AFTA potentially being the death knell for the Federation, as it now appears to no longer represent agencies.

One agent said, AFTA now represent the franchisor not the owners of the agencies nor the front line agents and it should become an Australian Federation of Travel Agency Franchisors and another Federation should be set up to represent front line agencies and owners.

Report by The Mole