Travel agents to charge fee for Aer Lingus flight bookings

29th Dec 2000

ALL Aer Lingus passengers booking flights with travel agents are to be charged a service fee within months, it emerged last night.
Faced with a decision by the airline to slash their ticket commission by 2pc on March 1, the agents say they have no option but to introduce the charge or face serious losses.
Aer Lingus insisted yesterday it would not put back introduction date of the new 7pc commission rate despite a plea by the Irish Travel Agents Association (ITAA) for time to prepare for the change.
The airline says it must cut the rate from 9pc to 7pc as part of an overall cost cutting plan which will also see the introduction of on-line booking for consumers within the next few months.
Aer Lingus points out its commission cut is simply bringing them g into line with the practice in other major airlines.
However, the national carrier is almost two years behind rivals Ryanair who cut agents` commission from 9pc to 7pc in May 1998 and then slashed them again to 5pc last August, amid uproar from the trade.
Last night an Aer Lingus spokesman said they hoped their new on-line facility would increase business and not divert sales from agents. Up to now 70pc of the airline`s business has come via the travel trade.
The national airline hopes to resolve soon its outstanding industrial relations problems with cabin crew and pilots ahead of the privatisation of the company now expected around June next.
Asked about the new service fee yesterday the ITAA president Fergus Kilkelly said he was confident it would not put off customers.
“We offer a very good service and we have to put a value on that,” he added. It would be up to individual agents to set the fee they felt necessary to compensate their business for the loss in commission.
Meanwhile Aer Lingus will not be placing an order or option for the Airbus giant new jumbo, the A380, despite indications that the airline`s capacity on the key North Atlantic routes is set to soar in 2001 because of the increasing success of the OneWorld alliance with American Airlines and British Airways.
For the first time, frequent fliers with both American and BA will be able to redeem their bonus points with Aer Lingus - opening up the possibility of American holidaymakers visiting Ireland and then returning to the US via Great Britain.
However, despite the growth predictions, Aer Lingus will not be replacing or augmenting their Airbus A330s with their new bigger brother, the A380. Whereas the A330s boast the capacity for over 300 passengers, the new A380 will become the largest aircraft in service by catering for over 520 passengers. The aircraft will also boast a leisure area, a bar/restaurant and even a cinema.
Airbus`s bitter rivals, the US firm Boeing, has already commenced work on a larger version of its own best-selling 747 jumbo which was originally launched in 1970.
But Airbus has clinched orders for 50 A380s - the minimum required to commence production - from airlines including Air France and Lufthansa. Now, the Airbus consortium is seeking follow-on orders from existing Airbus customers, including Aer Lingus.
Aer Lingus, like other European airlines including British Midland, is switching from a Boeing-dominated fleet to an Airbus fleet.
Special purchase prices have been offered on the A380 - but Aer Lingus has declined even a production option because of concerns about repeating its difficulties with the 747s on the North Atlantic route where under-capacity in non-peak season, coupled with soaring operating costs, almost forced the Irish flag carrier into financial difficulties in the early 1990s. However, Aer Lingus is to continue its acquisition of Airbus short-to-medium range aircraft including the A320 and A321 for their European services. Aer Lingus eventually aims to replace all its Boeing 737s, once the backbone of the fleet, with Airbus aircraft.
Ryanair has already firmly ruled itself out of the North Atlantic and long-haul markets, preferring to focus on the airline`s success in cut-price routes within Europe. Ryanair`s $1bn purchase of 25 Boeing 737-800s remains the most expensive aircraft deal ever by an Irish airline. The airline expects 2001 to be very successful given the imminent sale by British Airways of its rival, GO!, and confirmation by Virgin that it will axe its Irish subsidiary, Virgin Express, next month.


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