‘It’s war’: Opponents round on Lufthansa

‘It’s war’: Opponents round on Lufthansa

A senior industry source described Lufthansa’s plan to impose a €16 fee on GDS bookings as a “declaration of war”, as the carrier declared its intention to “save money on the GDS”.

Opposition among corporate travel buyers and industry associations appears to have solidified, with several groups studying grounds for legal challenges under competition law and price-transparency regulations.

The industry source suggested Lufthansa is already paying a price in lost bookings, saying: “Big corporates are instructing their travel management companies to book away from Lufthansa.

“They say they are not going to pay [the fee].”

The German carrier took the industry by surprise when it announced the fee on June 2, two days after the expiry of a full‑content agreement with main GDS partner Amadeus.

The charge will apply in all markets and on all Lufthansa group airlines – including Swiss, Austrian Airlines and Brussels Airlines – from September 1.

Lufthansa chief executive Carsten Spohr told fellow airline chiefs at Iata’s annual general meeting in Miami last week: “We thought it time to act, not just talk. Let’s save some money on the GDS.”

A leading industry figure told Travel Weekly: “Lufthansa declared war unilaterally. How it plays out will be determined by the market or by the regulator. It doesn’t seem to be going down well by the reaction from buyers and agents. If corporates start booking away, if buyers react strongly, things could look quite different by September. I don’t see how it will be sustainable.”

However, the source added: “It could take a lot of time to sort out.”

Another source described Lufthansa’s move as “an attempt to force a new model on travel agents and buyers”. For it to work, the carrier must hope agents and buyers accept the fee and book direct or other carriers follow its lead.

However, industry sources queried Lufthansa’s ability to impose the fee outside its German home market, saying: “How can Lufthansa maintain this kind of control in markets it is not strong in?”

A senior international agency source said: “Lufthansa sells 70% of its tickets and takes 80% of its revenue through travel agents. It gets sales in areas of the world where it would not have a chance without a GDS.”

Other carriers have expressed enthusiasm for Lufthansa’s move, with 96 out of 120 airline chiefs suggesting they were considering following suit in an electronic poll at the Iata AGM (Travel Weekly, June 11). But Iata members are unlikely to pile in immediately. Rivals will not only hope to pick up business from Lufthansa, but also remain locked into full-content agreements with GDSs.

Paul Wait, chief executive of UK travel management company body the GTMC, warned the airline that operating without a GDS “cannot be sustainable”. He described Lufthansa’s new web portal for agents, which the carrier offers as a way to avoid the €16 fee, as “not fit for purpose”.

The Global Business Travel Association (GBTA), which represents major corporate travel buyers and TMCs, called on Lufthansa to reconsider, saying it “strongly opposes” the fee. It said the fee would “negatively impact corporate travel programmes”, “cause fragmentation of existing distribution processes”, and result in “significant increased costs” and “decreased price transparency”.

Lufthansa remains engaged in talks with trade representatives as it seeks support, but Travel Weekly understands the carrier has no talks scheduled with main GDS supplier Amadeus.


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