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BA’s new GDS deal won’t last
TravelMole Fast Conference Special: The ground-breaking agreements brokered between BA and the GDSs are only a sticking plaster over the next three years says BA’s Ian Heywood – revolutionary change in the distribution chain is set to come. Speaking at Tuesday’s inaugural TravelMole Fast Conference in London, he said: “The model is clearly broken – we have just put an Elasterplast over it to make it last the next three years.” Mr Heywood is head of corporate sales at BA. He added: “We’ve been trying to reduce fees for ten years because we’ve been over-charged by the CRSs for ten years. “There is a willingness to reduce fees among the GDSs but the problem is that none of them are willing to negatively influence their market share.” Mr Heywood said that the deal would provide stability for the next three years, but beyond that change was needed. “This solution buys us three years of time”, he said. Also on the panel was Sabre director UK, Ireland and Nordic region, David Brown. He said Sabre would be renegotiating the deal with BA before the three years was up following GDS de-regulation in Europe, which he anticipated as happening before the end of the year. He said: “The booking fee won’t be the same for all suppliers after deregulation. Also, the way fares are highlighted on the display could be different.” He added that Sabre and BA were closer than they had ever been. Mr Heywood blew this out of the water when he said: “Beyond these three years, we can’t say whether we will be using GDSs.” Another panel member was GBTA chairman and Carlson Wagonlit executive vice president EMEA, Richard Lovell. He criticised BA’s recent moves. He said: “It is not a cost reduction, it is a cost transfer. These will inevitably come back round and bite the supplier in the end, because people will want to see the cost of a ticket continue to fall – something we have seen already.” His views were echoed by ABTA chief executive, Ian Reynolds who also described BA’s new deal with the GDSs as a “cost transfer”. Mr Heywood disagreed, he said: “All the GDS companies pay incentives to agents so I don’t believe it is a cost transfer.” Report by Ginny McGrath For information on future TravelMole Fast Conferences, please visit www.travelmole.com/fastconferences, email [email protected], or call +44 (0)20 7691 3292.
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