United Airlines has "spared no expense" in preparing for the switch to a unified passenger services system, scheduled to occur before the end of the current quarter, according to senior vice president of worldwide sales Dave Hilfman. Following its merger with Continental Airlines, United opted to consolidate operations on Continental's pre-existing Shares system, furnished by HP.
Corporate America, including a number of companies that until this week considered Northwest Airlines a preferred supplier, is fuming over Northwest Airlines' plan to charge travel agencies fees for bookings they make in the global distribution systems.
United Airlines yesterday announced a new corporate-travel portal that offers fee-free domestic bookings and as much as 4 percent off United's published fares, as well as other air, car and hotel content on a site powered by Orbitz. Soon to be in beta test with a handful of companies, United said the new GoBusiness portal would launch in late November.
Cendant Corp. executives today said the agreement signed between Northwest Airlines and Sabre Travel Network provides little clarity on how such deals might be structured between the likes of Northwest and Cendant's Galileo global distribution system. Nevertheless, president and CFO Ron Nelson said, "I think revenues are going to be stable" after the bulk of negotiations between major airlines and GDS companies are concluded later this year.
Another airline CEO is suggesting that the distribution cost structure is backwards.
American Airlines yesterday said it is working with Cendant to deliver by June of next year a revamped corporate-booking site that includes privately negotiated rates on AA and its affiliates, hotels and rental cars; public rates for other airlines and travel suppliers; and real-time traveler data and back-office integration for reporting, among other features.
Cendant Corp. subsidiary Galileo International today announced a five-year distribution agreement with Continental Airlines. The deal provides Galileo global distribution system users--online and offline--access to all of the carrier's published fares. Terms were not disclosed.
Travel Weekly yesterday reported that Northwest Airlines said its global distribution system fees were torpedoed by lost bookings due to bias in the GDSs. 'Unfortunately, as we got to the implementation date, the bias that Galileo and Sabre imposed on our displays had a very significant impact on our bookings,' CEO Richard Anderson told airline employees in a recorded message. 'As a result of that pressure, we were forced to retreat from our original position.'
New entrants in the global distribution system space 'do not provide comprehensive travel management solutions and are not focused on the success of agencies, corporations and airlines,' according to Sabre Holdings Corp.
In August 2004, G2 SwitchWorks unveiled itself on the day after Northwest Airlines announced its doomed global distribution system fee. G2 positioned itself as a GDS alternative and was seen as one reason why the likes of Northwest could play harder ball with Sabre.