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American Airlines and on-line agencies such as Orbitz and Expedia have fought a full scale conflict over tolls. Early this weeks American announces that it is trying to redesign the way it sells airfares by withdrawing all its flights from the Orbitz reservation site.
Then, last night, in a seldom sign of support from a rival, posting site Expedia backired the change in the way American's ticket are shown on its website, making it extremly hard to find US flights. "That was against the background of the recent US Airlines ruling to stop Orbitz from reselling its stock and a possible interruption in Expedia's capacity to resell US airlines seats when our agreement with US airlines expires," Expedia said in a declaration to ABC News.
"It has shown that American Airlines only wants to do deals with tour operators, with a new type that is free of consumption and choices. "All American Airlines seats previously on these pages are still available, but this battle could mark the beginning of a new age in how travellers plan to buy their flights and possibly also how much they are paying.
America's choice to dump Orbitz comes less than a weeks after Delta withdrew its ticketing from three smaller destinations: CheapOair, BookIt. com and One Trave. It is the fee that each of the on-line agencies receives for each flight ticketing they sell. At American, we try to direct more ticketing to our website and keep a greater proportion of our ticketing costs to ourselves.
expedite said today that the move of US carriers "will lead to higher cost and less visibility for the consumer, making it hard to match ticketing fares and pricing alternatives with those of other carriers. "The move of the website makes it very hard to find US flights on Expedia. There are no flights or fares available for US flights, but the click through a set of hyperlinks will take you to multiple monitors that allow you to reserve each stage individually before you finally find pricing information for a similar journey on USA.
What are the costs for a non-stop ticketing on America? Same $235 as Delta, but the clients wouldn't know right away. Half a doze of researches carried out by ABC News on various flights resulted in a similar event for them. "Whilst airline fare ticketing with Expedia remains available, preference for other carriers may make passengers think they have less choice, even in times where America's rates are lower and flight plans are better than with other carriers initially list.
Although ITA is not a well-known name, it has some of the most efficient air fare tracking technology, which is often outsourced. Then why would American and Delta make their ticket reservations hard to find? A carrier must make a charge to a third party such as Travelocity, Expedia or Orbitz who is selling a seating position on one of its aircraft.
According to Robert Mann, R.W. Mann & Company's carrier advisor and chairman, these charges can be up to $4 per itinerary. Example, look at a $160 Delta Air Lines air line from Boston to Orlando and stop in Atlanta in any direction. To buy this on Orbitz, Delta would have to transfer $16 -- or 10 per cent of the fare -- to the reservation page.
When the same fare was bought on Delta.com, the company would keep every penny of the $160 fare. It is estimated that around 80 per cent of Southwest's ticketing is directly owned by the company. Previously it was higher, but the carrier opened some of its more expensive airlines' ticketing for businesspass.
Conventional operators such as American and Delta are only selling 20 to 30 per cent of ticketing directly through their webpages. Whilst American's move is unlikely to have a direct effect on ticketing rates, other companies will check their own business with third-party-bookingsites. "and they' re doing a fabulous job.
So if I were an air carrier, I could think: If I can, why not? "Passenger web sites are selling a great deal more than just plane tickets. "Perhaps the carriers are considering why they are sharing these perquisites with Orbitz? "In recent years, carriers have reduced labour cost and increased charges.
"America and the carriers in general are trying to get more controls and lower the cost of distribution," said Ray Neidl, an airliner specializing in the Maxim Group. Distance of the big carriers from such destinations would not necessarily mean higher fares, but it makes it more difficult for the passenger to find these great value fares.
"The most favorable rates are often these multi-carrier initiatives."