Commission cuts come thick and fast
Virgin Atlantic has insisted it has no plans to cut payments for agents – despite the latest announcement from bmi that it is following BA’s lead and cutting commission to 1%.
bmi is not alone in its decision to follow BA. American Airlines, GB Airways and Spanish airline Iberia have all said they will cut commission to 1% for agents in the UK.
A Virgin Atlantic spokeswoman told TravelMole: “We are not planning any changes. We have recently introduced a new renumeration scheme where agents can be rewarded in different ways and if anything some have even seen their commission increase. There will be no changes in the near future.”
bmi’s commission cut comes into effect on January 1, 2004, exactly 12 months after it reduced commission from 7% to 4%. The carrier said the decision followed “a period of productive consultation and distribution strategy considerations with key industry partners and customers.”
The airline added: “bmi is committed to the travel trade as a key and important distribution channel. However, the commercial environment has changed dramatically over the past two years and we believe the time is right to adjust our commission levels to ensure that bmi remains competitive in a continually changing market place.
Meanwhile GB Airways will reduce commission to 1% from December 1, with American Airlines following suit on December 10. Iberia has already announced its intention to reduce commission to 1% from January 1.
See our previous stories:
08-Sep-2003 Iberia drops to 1%
05-Sept-2003 TravelMole Interview: Tiffany Hall, British Airways
02-Sep-2003GBTA: BA decision will cause consumer confusion
29-Aug-2003 TravelMole Interview: Sandy MacPherson, ABTA
29-Aug-2003 BA to ditch Fresh Approach
12 Dec 2002 ABTA loses case against BA
13 Feb 2002 BA cuts Fresh Approach payments
23 Jan 2002 BA and ABTA at loggerheads over Fresh Approach
08 Jan 2002 ABTA tries to calm Fresh Approach fears
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