Travel trade at ‘watershed’ on distribution

Travel trade at ‘watershed’ on distribution

The travel industry is at “a watershed” with Europe’s major network airlines poised to end decades of full-content fare distribution through global distribution systems (GDSs), leaving many travel agents on the side lines.

That is the view of senior UK industry figure Ken McLeod, who is Advantage Travel Partnership director of industry affairs and president of the Scottish Passenger Agents Association (SPAA).

McLeod warned: “Fares will be out in the market that most of our agents can’t access. A slew of fares that sit behind an API will not be available to the general market.”

British Airways, Lufthansa and Air France-KLM plan to make many fares available only via their own direct connect APIs – application programme interfaces – or online portals, in line with Iata’s new distribution capability (NDC), while surcharging on GDS bookings.

Lufthansa’s lowest fares on selected routes from Germany became available only to agents with a direct booking channel this month and UK senior sales director Andreas Koester said: “We envisage similar in the UK.”

BA launched the first of its new “NDC and direct products” recently with almost four times as many price points available direct as via GDSs, having promised last December to introduce “significantly more price points to trade partners who have an NDC connection”.

McLeod told a Travel Weekly Business Breakfast on the future of airline distribution: “Smaller agents are left in the wings. Some individual agencies have access to that content, but most don’t. It leaves a two-tier industry.”

He insisted: “This affects leisure agents and tour operators – not just travel management companies (TMCs). We have organisations trying to sell to customers of our agents saying they can give a cheaper price because they avoid the [GDS] fee.

“This is a watershed for the industry, but we’re piggy in the middle.

“There are very few airlines capable of implementing NDC [and] our members can’t afford to spend on research and development while this change is going on. There are no solutions yet.”

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