Travel Agents Protest Commission Reductions
A number of travel agents in California and across the nation temporarily closed up shop Thursday to protest the airline industry’s latest reduction in commissions paid to them, a change that has already resulted in more expensive booking fees for their customers.
Hundreds of independent travel agents picketed at airports in Los Angeles, Denver, Kansas City, Newark, New York and Washington.
“We’re out there on the streets trying to protect consumers because the airlines raised the prices on tickets in a backhanded manner,” said Richard Copland, president of the American Society of Travel Agents, which asked about 15,000 travel agents to honor the two-hour protest between 10 a.m. and noon.
Copland said the next step for his organization is to petition the Justice Department for limited immunity from antitrust laws in order to meet collectively and decide on a long-term response to the airline industry’s action.
The decision to lower travel agents’ commissions on domestic air travel bookings was initiated by American Airlines on Aug. 24 and was mirrored by its competitors.
It was the sixth time since 1995 that airlines have collectively lowered the cap or reduced the base rate on commissions to travel agents.
Financial incentives such as extra frequent-flier miles have been offered to passengers who buy directly from the carriers or over the Internet. After labor, fuel and aircraft, ticket distribution is the fourth-largest expense for the industry.
Under the new air fare commission structure, travel agents will receive a maximum of $10 for booking a one-way ticket and $20 for a round-trip for all travel within the United States or Canada, instead of $25 and $50, respectively.
The change, which analysts say could save the industry upward of $350 million a year, comes at a time when major carriers have sustained huge losses.
Travel agents were quick to denounce the commission changes, and many have responded by increasing the transaction fees they charge leisure travelers.
The airlines have refused to comment on the commission changes.
