Airlines cancel fees for travel agents
Swiss and Lufthansa will officially notify travel agents that they will no longer pay them for selling their tickets.
Two airlines are starting a travel revolution today: Swiss and Lufthansa will officially notify travel agents that they will no longer pay them for selling their tickets. This will likely make overseas flights more expensive.
This is a dramatic step, since until now all airlines paid agents 7% of the ticket price. The two airlines are now inaugurating the "zero fee" ticket, a first in Israel.
The new plan will take effect in about half a year, to allow travel agents to prepare for the change.
Other airlines, such as British Airways, Air France and KLM, are expected to make the change during 2008, too.
El Al is also expected to cancel its travel agent fees, but only at a later stage, even though it has denied planning to do so for now.
The official letter from the airlines notifying travel agents of the move will go out today, after a long series of meetings between the CEOs of Swiss and Lufthansa in Israel and the heads of the large travel agencies. Travel agents objected to the move.
In place of the fees from the airlines, travel agents are expected to charge customers "handling fees" for issuing tickets. The amount of the new charge has not been set yet, but it is expected to be around $50 per ticket. However, the fee may vary depending on the type of ticket and the amount of work put in by the travel agent.
Also, travel agents who meet the airlines' sales goals will also receive bonuses.
The low-cost airline Jetairfly, part of the Belgian TUI Airlines group, will be the first regularly scheduled airline to compete with the existing carriers.
The airline will fly the Liege-Tel Aviv route three times a week, starting in spring 2008.
Currently, both El Al and Brussels Airlines fly the Brussels-Tel Aviv route.
The civil aviation authorities of the two countries recently signed a new agreement allowing the additional flights.
This is another step by TUI to expand its operations in Israel. Its British Thomsonfly subsidiary started direct flights to Israel from London and Manchester in November, and its Corsairfly has requested permission to fly the Paris-Tel Aviv route.