Travel Agents Act to Recoup Lost Revenue : Expenses: Airlines have capped sales commissions. A court challenge against the carriers is possible, but for now a booking surcharge is the most likely route.

Faced with new limits on airline sales commissions, travel agents said Tuesday that they are planning to impose surcharges on customers of as much as $15 a ticket and to work out special deals with airlines to try to recoup lost revenue.

Some of the nation’s 34,000 agencies, which book 85% of all flights nationwide, also are taking drastic measures to cut costs as the airline-imposed caps on sales commissions took effect this week.

Airlines have put a limit on commissions of $50 a ticket, replacing the fee of 10% of the ticket price they had been paying. Agents had protested the action for the last month and plan to continue to fight in court.

Last year, airline commissions accounted for 60% of the travel agency industry’s $6.3 billion in revenue. Commissions on reservations for other travel and accommodations made up the rest.

The American Society of Travel Agents in Alexandria, Va., said it has received a letter from the U.S. attorney general’s office saying that the government is reviewing whether the caps violate federal antitrust law. The federal office could not be reached for comment.

“Travel agents have swallowed the bitter pill. They are trying to recoup what they can, and everyone is waiting to see what the big agencies are going to do,” said Christopher McGinnis, an Atlanta-based consultant and business travel book author.

Some local agents said they will impose fees of $10 a ticket, even though they are aware that their competitors might not match the surcharges.

“I think the customer will complain, but they need to be educated that to receive the level of service they have been receiving, (charging them) is what we have to do,” said Chris DeRose, owner of American Pride & Compass Travel in Orange.

She said 26 of the 36 travel agencies that participate in her Orange County consortium, a group of travel agencies that have banded to get better purchasing arrangements, plan to start charging fees.

“I know I provide a service to the public, which saves them time and the effort of calling the airlines directly,” said Penny von Kalinowski, owner of Windsor Travel in Los Angeles, who plans to impose fees.

Other travel agents say they have no immediate plans for fees, and instead are waiting to see if airlines make special deals that could help make up for commission losses.

Airlines such as Delta, which was first to announce the commission caps in February, and Continental have retreated a bit by offering to pay agents more to book selected tickets. Such special deals are called “overrides” in industry parlance because they are supplemental commissions that the airlines pay to increase their market share on hotly competitive routes.

“They have been around for a long time, but in the wake of the commission caps, we are seeing agencies being offered additional overrides,” said Steve Loucks, spokesman for the American Society of Travel Agents.

The overrides supposedly are being offered to the larger agencies in an attempt to retain the business and first-class customers who are the most profitable segment for airlines.

“A number of airlines have gone around and promised that for specific sectors, including international travel, they will pay higher commissions,” said Paul Moore, owner of Crown International Travel in Los Angeles. He said he is trying to line up such deals for his company.

Yet, one of the nation’s largest agencies, Carlson Wagonlit Travel in Minneapolis, said that it has not been approached or offered additional overrides.

Agencies are being helped somewhat, however, by other travel modes. Amtrak, for instance, has increased its 10% commission to 12% and 15% on some routes with no limitations on fees. Carnival Cruises bumped up its commission to 12% too.

According to Loucks, some agencies have reduced staffing, cut back on employee health insurance and renegotiated leases on offices and computer reservations systems. Harold Seligman, a Stamford, Conn., consultant to corporate travel department heads, said one travel agency, which he declined to name, is moving its corporate reservations center with 60 workers to a less-costly area of the country.

But he said he believes the cap on commissions eventually will save money for corporations with heavy travel budgets. Since travel agents were able to rebate part of their commissions to major corporate customers before the limitations were imposed, he said, it is obvious there was waste in the system.

If airlines start giving extra incentives or overrides to travel agencies despite the caps, Seligman said, corporate customers will soon find out and demand rebates.

“It’s an incestuous industry,” he said, “and nothing remains secret for very long.”