Opinion: OTAs should get a Euro referendum or leave Abta

Opinion: OTAs should get a Euro referendum or leave Abta

Steve Endacott, chief executive, On Holiday Group

Abta is a strong consumer brand that has value to the OTA community.

However it will be impossible for OTA's to stay in Abta if as a body it is pushed by the major tour operators into supporting the European bureaucrats' view that Flight-Plus should be banned, in favour of all agents also having to accept full tour operator liabilities.

The key problem is that this ignores the last 10 years of evolution, where the power of the internet has allowed customer via a few clicks to check a massive range of flights via sites like Skyscanner and thousands of hotels via sites like Booking.com.

If the Eurocrats get their way and impose an extra £20 worth of regulatory cost on OTAs, then many consumers will simply avoid agents and self-package holidays to save this cost.

How many will do this? To be honest we do not know yet, but the commoditisation of the seven night beach holiday, driven by the price visibility the internet gives, has massively increased price sensitivity and I could easily see a 30% shift.

This could be driven higher by the likely reaction of OTAs if this Atol extension goes through.

Few OTAs make money from selling flights and earn the bulk of their profit on the accommodation element of the holiday they sell.

Flights are sold as part of a basket approach, to make it easier for customers to book all the holiday elements from one site, as this convenience increases conversion.

However, if the Eurocrats impose this extra regulation then most OTAs will be forced to just sell accommodation only to customers and let them book their own flights.

Under these circumstances the shift to unprotected holidays could be as much as 50% to 60% and hence far fewer customers would end up financially protected than under Flight-Plus.

Abta seems to be taking a defeatist attitude and assuming that the Eurocrats have already made up their minds and that there is no point trying to defend the UK’s adoption of Flight-Plus.

However, the OTA and wider agent community are now mobilising and giving Abta a clear choice - defend our livelihoods or be abandoned.

If this does not occur, any agents staying in Abta are sanctioning and giving creditability to a stance that makes them uncompetitive in the dynamic packaging sector.

To be clear, I have personally worked closely with Abta all my 25 years in the industry and have no intention of giving up on membership of this key trade body without a massive fight.

However, I cannot, and will not, allow the major tour operators to dictate Abta’s position. 

As a minimum I am asking Abta to present all the facts to its full membership and put the issue to a one-member one-vote referendum, rather than having such a key issue decided by a board of directors that is very heavily weighted towards traditional tour operators.

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