Dec 2, 2008

Business - Travel agencies won't sell Jet tickets from Dec 4

Anirban Chowdhury

Move aimed at forcing airlines to revoke decision to withdraw 5 per cent commission.

Over 2,500 travel companies, including IATA travel agents and online travel agencies (OTAs) such as Makemytrip, Cleartrip, Yatra and Ezeego, have decided to stop selling Jet Airways’ tickets from December 4. The move could impact over 85 per cent of the airline’s passenger revenues.

This decision was taken today at a meeting of the six associations — Travel Agents Federation of India (TAFI), Travel Agents Association of India (TAAI), IATA Agents Association of India (IAAI), Indian Association of Tour Operators (IATO), Association of Domestic Tour Operators in India (ADTOI) and Enterprising Travel Association of India (ETAA) — which cumulatively account for nearly all of the 2,800 IATA agencies, apart from numerous travel portals like Makemytrip and Cleartrip.

The agents have decided not to sell Jet Airways tickets in a bid to compel the airline to pay them 5 per cent commission, which was withdrawn from November 1. Apart from Jet, Air India and Kingfisher have also stopped paying commission to travel agents.

Jet executives could not be contacted for their comments.

According to statistics presented at the meeting, Jet earns revenues of Rs 18.1 crore every day, out of which Rs 16.2 crore is generated by travel agents (online and offline).

“We have decided to stop selling Jet tickets from December 4. This was decided at today’s meeting, where more than 60 per cent of the entire travel industry was represented. Although three carriers have stopped paying us commission, we have decided to go ahead with Jet because it is the market leader and it should be the first to make a move,” said Ajay Prakash, General Secretary, TAFI.

While Yatra refused to comment on the issue, both Makemytrip and Cleartrip said they would go ahead with whatever TAFI and TAAI decided. “We are going ahead with whatever the associations have decided,” said Deep Kalra, managing director, Makemytrip.

The three Indian full service airlines and several international carriers stopped paying 5 per cent commission on the ticket prices to travel agents from November 1. The agencies have had around 10 meetings with airlines to make them withdraw their decision but that has not worked. The airlines, in turn, have asked the agents to levy a transaction fee of Rs 350-10,000 per ticket in lieu of the commission.

1 comment:

iXiGO Team said...

Travel intermediaries will need to reinvent their business models to survive. Evidently, this is hard and difficult to do overnight. Therefore the knee-jerk reaction from them as a whole.

iXiGO continues to search, show and allow transaction referrals for Jet Airways and JetLite