The International Air transport Association announced new services to help airlines reduce costs and risks associated with credit card operations. Worthy goals, but does anyone really think credit card companies will lower their rates simply because IATA asks?
IATA previously has cried out against GDS fees, saying it "cannot accept" $4 per transaction and demanding GDSs cut fees to something closer to 50 cents. How well did that go over?
Today at IATA's Annual General Meeting in Kuala Lumpur, the group's director general Giovanni Bisignani lashed out at just about everyone. Based on his speech (posted
here), the message seemed pretty simple: the global airline industry is in a tailspin, and if you are not helping us in the way we deem most appropriate, then you are part of the problem. He attacked governments for their policies on taxation and "archaic" ownership rules that hinder access to capital. He attacked several airport operators and air traffic control entities for daring to raise user fees, calling such decisions "nonsense." And he implored "all suppliers and manufacturers" to "reshape their products to reduce their costs and ours ... Governments and partners must understand that we are struggling to survive with a new and harsh reality."
He also warned travel agents that "the clock cannot be turned back. Travel is more accessible than ever in price and purchase options. To survive in the global online market you need to reshape your services and your business models to provide greater value that travelers are willing to pay for."
Kind of vague but not wrong on its face. But what about when he turned to the global distribution systems? "We cannot accept that those in the West charge around $4 per transaction when China TravelSky does the same job for $0.50. This must change," said Bisignani. Hmmm.
For many years debate has raged concerning the correct construction and use of international airline fares. The argument is all about interpretation and clever manipulation of rules which can result in travellers and their employers enjoying major savings if their agent is smart enough to know the "loopholes." Such intelligence was, and still should be, a key differentiator between savvy and average TMCs.
You read that correctly. Despite weakening demand trends, Wall Street analysts are not discounting the possibility of not only U.S. airline industry profits in 2009, but perhaps
record profits. Why? Fuel prices that have retreated dramatically from record highs, sizable capacity cuts, airfare hikes and the numerous other survival moves made by carriers this year.
While I doubt it will ever happen (years ago I put some effort into it, all for naught), the airlines could make life for TMCs, travelers and travel managers a lot less complicated and much more efficient were they (by guiding approval through the Airlines Reporting Corp. and International Air Transport Association) to allow a service fee to made a part of the ticket. Their mantra has been "we don't want anyone messing with the price of our ticket," but that is flawed reasoning.
