British TMCs say distribution fee has hurt Lufthansa, airline disagrees

Lufthansa lost GDS market share on bookings from the U.K. to Germany following the imposition of a controversial 16-euro surcharge in September, according to trade group the Guild of Travel Management Companies (GTMC).

Lufthansa counters that the fee has not harmed its bookings companywide.

The data, based upon a sample of 12,000 bookings made by GTMC members in the three months before and after the surcharge went into effect, shows that Lufthansa’s market share declined 8.5%. Those numbers suggest “that TMCs have switched business away from the airline group to avoid passing on the charge to their customers,” GTMC said.

The data, compiled for GTMC by England-based travel technology company 7R Group, showed that in June Lufthansa’s market share for U.K.-to-Germany bookings among the trade group’s members was 32.9%. In November, that number had dipped to 24.4%. Meanwhile, other carriers either matched or increased their market share during that time.

GTMC members account for more than 80% of managed business travel spending in the U.K., the guild says.

In a statement to Travel Weekly, Lufthansa said that the GTMC figures are incomplete, as they only account for bookings made through the trade group’s channels. The company added that the share of Lufthansa’s tickets that have been sold via its supplier website rose from 29% in June to 35% in December.

“Looking across the Lufthansa Group, we cannot see any decrease resulting from the introduction of the [distribution-cost charge],” Lufthansa said.

Lufthansa Group is levying the fee on bookings for its four airlines: Austrian Airlines, Brussels Airlines and Swiss International Air Lines in addition to its namesake Lufthansa German Airlines.

As the booking fee has been vigorously debated the past several months, Lufthansa has said that it wants to disrupt the current travel distribution status quo in order to spur innovation.

Travel agents, however, have vigorously opposed the fee, saying that if other airlines fall in line, they’ll have to either abandon the time-saving approach of booking tickets through GDSs or risk losing their clients by having to charge higher prices.

 

[Source:- Travelweekly]

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