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Airlines to stop paying agents commission |
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World News
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Thursday, 07 January 2010 15:23 |
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Agents booking four Star Alliance airlines will face zero commission payments in 2010.
Key members Air Canada and US Airways moved from paying 1% commission to zero on January 1. They will be followed by Austrian Airlines, which will make an identical move on February 1, and Brussels Airlines, which makes the same transition on April 1.
In a letter to agents, Bob Atkinson, Air Canada’s general passenger sales manager, UK, Ireland and Nordic Countries, said the removal of commission payments by Air Canada was “because of the economic situation being experienced by the airline industry and the actions taken by a number of other carriers to cut distribution costs”.
The decision brings the carriers into line with most of the other Star members.
Another airline to reduce its payments to agents this year is Spanish airline Air Europa, which is an associate member of rival alliance Skyteam. It launched a twice-daily Gatwick-Madrid service in May last year offering 5% to woo the trade, but switched to 1% on January 1.
Since British Airways led the way in moving to zero commission in 2005, most other airlines have steadily scaled down their payments to the trade.
The Middle East airlines have gradually reduced what they pay now that they have established themselves in the UK market, with Qatar Airways moving to zero commission in late 2007 and Etihad cutting its rate to 1% in January 2008. Emirates has also reduced its rate, but still pays 5%.
Now only a few carriers, including Kuwait Airways, Pakistan International Airlines and Oman Air, still pay the top rate..
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