CATO responds to Travel Mole

The Mole thanks Simon Hills. Chairman of CATO for taking the opportunity to send in this explanation of CATO’s position with regard to the current car rental rates scenario and this is what he said – it is reproduced verbatim in line with TravelMole’s highest editorial integrity standards and policies [http://www.travelmole.com/about.php?ref=log#editorial]: –

CATO is an extremely broad church – our members include domestic and international tour operators, domestic and international wholesalers, car rental principals, car rental aggregators and wholesalers, multi-national and wholly Australian owned businesses and a growing list of Associate members who contribute to the travel industry without being an actual part of it, such as web-development companies and distribution companies.

We have members who have preferred supplier relationships with every agency in Australia, and we have members who have no preferred supplier relationships with any agents at all.

It is clearly impossible to please them all, or to speak with one voice on every issue raised and it is not even possible to have full agreement amongst all the Committee.

In my position I am continually asked for opinion on many and varying issues and of course some members will disagree with my comments from time to time, but hopefully the general view will be positive, and we will continue to help support all our Members.

The specifics of the issues involving Driveaway which are being raised as they pertain to CATO are quite simple.

** Driveaway is a fully licensed travel agent.

** It is a participant in the TCF.

** It is a full member of CATO.

** Its relationship to Kemwel, and to the parent company is not relevant to their membership of CATO, and as such we should support Driveaway as an independent member of CATO.

** CATO does not interfere with the business of its members, and makes no comment on such issues.

We can comment on a number of facts about our member, Driveaway.

The company and brand “Driveaway” supports the Agents in Australia, witnessed by 3 salient facts: –

** 95% of their business comes directly through travel agents

** They are the current winners of the NTIA award for Best International Car Wholesaler, as voted on by Australian travel agents

** Driveaway is the only Car Rental wholesaler who has financially supported the Travel Industry Careers Association with a substantial cash donation – they are a Platinum sponsor.

As such, they are owed our support and will continue to receive it.

If we derided every member whose business decisions were unpopular, we would have no members, no support and absolutely no credibility.

CATO is not an industry watch-dog, nor is it a policeman. It is owned and supported by its members – all of them.

My personal view is that assertions that Driveaway are not supportive of the Australian travel agents are ludicrous.

Clearly the majority of Australian agents support them as witnessed by the above, and clearly their support of the ‘jobs in travel’ initiative points to a business committed to the Australian industry for years to come.

This entire issue has been driven by unseen forces, and some of the comments I have read have been ill-informed and clearly full of self-interest.

The industry is changing.

Agency chains now own full wholesaling divisions in direct competition to existing preferred suppliers.

Just as agencies are changing their distribution balance, so too are wholesalers and tour operators responding by changing the balance of their distribution.

This is inevitable.

Nearly every wholesaler has some measure of direct business, most of which is growing, and yet year after year they continue to grow their business through travel agents.

Preferred agreements continue to flourish, and niche operators continue to find business through Agents.

The market is getting harder, but it appears to me that there is plenty of room for growth for all.

Endless argument about pricing issues raised though Kemwel, whose clients will probably never think to buy car rental through a travel agent, are largely irrelevant.

When a few dollars matters more than service, knowledge and great product, then we are all in trouble.

When any agent is resigned to sell through price alone, then their future will indeed be bleak.

The ‘Kemwels’ of the world do not threaten the agency network, and nor do wholesalers who develop direct business.

Service, product selection and knowledge will always bring business to travel agents, just as some clients will only ever book on-line.

A report reproduced verbatim by The Mole from Simon Hills, Chairman CATO