CRS changes ‘would hurt agents’

Saturday, 02 Nov, 2003 0

Proposed CRS rule changes which the US Department of Transportation office sent to the White House this week could be very costly to travel agents, warns the top official of the American Society of Travel Agents.

“We don’t know how much, but it could be millions,” William Maloney, executive vice president and CEO of ASTA, told TravelMole.

Under the proposed rules, airlines would have the option not to post information. The result is that agents would have to check several sites, and even then not be sure they had the best rates. Among other changes, CRSs would be forbidden from paying productivity incentives to travel agents to acquire or use their services.

The issue has remained unresolved since 1995, a condition Mr. Maloney termed “ridiculous.”

“The DOT is clearly attempting to bail out the airline industry”, he added.

After reviewing the DOT findings, the White House has until the end of the year to reach a decision. If the rules are adopted, Mr Maloney said the fight would not end. ASTA would then lobby the US Congress to overturn the proposed rules, he said.

Consumers as well as agents would be adversely impacted by the proposed changes, according to Mr Maloney. He cited a just-released survey conducted by ASTA which gave failing grades of “D” or “F” to the DOT for its failure to look out for the best interests of consumers. The survey found 78% of ASTA respondents believed the DOT’s proposed changes to the CRS rules are biased in favor of the major airlines.

Other findings included: More than three quarters of agents (85%) disagreed with the DOT’s assertion that changes need to be made to provide airlines more negotiating leverage in travel distrubution. More than two-thirds (67%) say the incentive payments that the DOT is proposed to eliminate are an extremely important source of income for their business. More than two-thirds of respondents (69%) oppose DOT regulation of contracts between travel agents and suppliers.

And most travel agents surveyed (87%) said if CRS rules are retained, they also should apply to the airline-owned Orbitz. Concluded Mr Maloney: “A free market wells best for everyone.”

See our previous story:
22 Sep 2003: D-day for proposed new GDS rules draws near