Indian Travel Agencies to Stop Selling Air Tickets

In response to the intended scrapping of airline commissions starting October 1st, major Indian travel agencies warn they will stop selling domestic and international air tickets if a resolution to the intended zero-commission policy was not ironed out at the scheduled meeting of leading airlines and agents on July 24. The move to stop selling air tickets will affect air travelers that could face problems booking or canceling tickets through company-owned ticketing counters or through the internet, which is not a popular option for international travel.

The decision to stop selling tickets was agreed upon earlier by India’s top three travel associations that include the Travel Agents Association of India, Travel Association Federation of India and Indian Association of Tour Operators. The three organizations represent more than 4,500 IATA-accredited international and domestic agents and over 85% of the total air ticketing business. Travel agents currently receive 5%, previously 9%, of their base fare on tickets as commission from airlines. But since last month domestic as well as foreign carriers have informed travel agents that no commissions would be paid starting October 1. Higher costs and slower growth has prompted airlines to adopt the zero-commission policy that would result in over INR 1,000 crore in savings.

Agents question the basis for the policy citing examples of other foreign carriers that continue to give out the 9% commission like Australia and Japan. However, prospects of overturning the decision seem likely as the same zero-commission policy for agents was introduced by airlines in Pakistan recently. The decision was reversed within a week.

Source at www.eturbonews.com