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Hong Kong's travel trade urged to retaliate against Lufthansa, SWISS
Prudence Lui, Hong Kong, June 26, 2012
 

 

THE TRAVEL Industry Council (TIC) of Hong Kong has issued a notice to its 1,500 members, urging them to stop providing ticketing and enquiry services for Lufthansa and SWISS until further notice in retaliation against the carriers’ implementation of a zero commission policy.

 

The two airlines had ceased paying commission to travel consultants since June 1.

 

TIC’s move came after a failed attempt to seek the airlines’ reconsideration through a meeting on April 13 and a subsequent letter. However, the call was met with mixed reactions from the trade, with several travel consultants saying that they “would not do business for nothing”.

 

Tommy Tam, managing director of Arrow Travel, said: “The carriers only informed us three months before and it was all very rushed. Air France/KLM (which had adopted the zero commission practice in April 2010) gave us a one-year notice. ”

 

This retaliation is a stark contrast to the street demonstration that Hong Kong’s travel trade had led against Air France/KLM in 2010. Tam explained that there was a lack of cooperation between travel consultants to evoke a change in the airlines’ decision this time around.

 

He said: “Moreover, the (demonstration) didn’t change the outcome and zero commission was implemented in the end. Travel consultants have no choice but to accept.”

 

Tam intends to promote other airlines that offer commission and impose additional charges on customers who request for Lufthansa and SWISS flights.

 

Jacky Chan, assistant general manager of FIT specialist Eastrip Travel, said: “We don’t want to turn away business. I will book the ticket for my client if he agrees to bear the HK$300 (US$39) handling charge. To stay competitive we will diversify our products and services, such as offering shorthaul FIT packages to China for one or two days.”

 

 
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COMMENTS
Zero commissioning is just the airlines way of increasing fare revenue without carrying the moral responsibility of increasing costs to the passengers. The PX now can scream at the agents for charging service fees. In fact, the term \"agent\" is no longer applicable because of the zero commissioning. Travel arrangers no long actually represent the airlines and have become pawns. Perhaps \"agents\" as a profession should go where the buggy whip industry when automobiles took over the roads. Zero commission and the internet no longer make the profession attractive. Travel arrangers should simply boycott the zero airlines and explain why when a Px wants a ticket on, say, SWISS.
Posted by: Fred Harvey
26-06-2012 19:15:50
Travel Trade in HKG was already aware that this was coming - so it was no surprise. Air Lines World wide are trying to resort to cutting their distribution costs. Travel Trade must change their ways of doing Business and look for other target Groups. However, I feel that it is wrong on the part of the Carrier to pay over-rides to Consolidators, which, in most cases, works out to paying out much more than the usual Agency Commission. It is being Penny-wise and Pound foolish???
Posted by: R.L.Narula
26-06-2012 21:19:20
 
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