CUTS DON'T FLY WITH TRAVEL AGENTS; AIRLINES' DECISION SIMPLY PASSES COST ALONG TO CUSTOMERS.Byline: Chris Sieroty Staff Writer Rhonda Maroney, a travel agent for 16 years, says five of the world's largest airlines There are several ways to measure the size of an airline, so several different lists of the world's largest airlines are available. World Scheduled passengers carried [1] Rank Airline 2006 1 American Airlines 99,038,000 are ``crazy'' for recently deciding to slash commissions by 3 percent on tickets booked through agents. Maroney, the owner of Help Me Rhonda Travel in Chatsworth, said the cut from 8 percent to 5 percent will force her to begin charging an added fee for each ticket sold to replace the lost income. ``You can live on 8 percent, but not 5 percent or lower,'' she said. But Help Me Rhonda Travel and thousands of travel agencies nationwide will now have to figure out how to make money other ways, either through more fees tacked onto their bills, mergers with larger agencies, or - barring that - going out of business. The commission cuts announced late Monday by Northwest Airlines, KLM KLM Kaiserliche Marine (Enigma: Rising Tide game) KLM Koninklijke Luchtvaart Maatschappij (Royal Dutch Airlines) KLM Klub Langer Menschen (German: Tall Person Club) Royal Dutch Airlines and Delta Air Lines follow similar cuts announced last week by United Airlines and American Airlines American Airlines Major U.S. airline. American was created through a merger of several smaller U.S. airlines and incorporated in 1934. It continued to buy the routes of other airlines, becoming an international carrier in the 1970s; its routes include South America, the . The airlines say it will save them millions of dollars annually, presumably pre·sum·a·ble adj. That can be presumed or taken for granted; reasonable as a supposition: presumable causes of the disaster. savings that will be passed along to customers eventually. But travel agents say the airlines are being greedy greed·y adj. greed·i·er, greed·i·est 1. Excessively desirous of acquiring or possessing, especially wishing to possess more than what one needs or deserves. 2. , and that the cuts eventually could lead to higher fares since customers won't have agents shopping for the best deals. ``This decision isn't about the consumer,'' said James Ashurst, a spokesman with American Society of Travel Agents ASTA, short for the American Society of Travel Agents, claims over 20,000 members in 140 countries. Its members include travel agents and companies who offer travel products, such as tours, cruises, hotels, car rentals, etc. in Alexandria, Va. ``This is about the billions of dollars the airlines will make because consumers will pay too much for airline tickets.'' By cutting commissions, ``the airlines want to push, especially the small travel agent out of businesss,'' said Susan Dushane, an agent with Travel by Greta in Northridge and president of the Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, Chapter of the American Society of Travel Agents. In a statement, Northwest Airlines said tickets purchased by travel agents in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. for travel to and from any U.S. destination will earn a 5 percent base commission rate with a maximum payment of $50 for each round-trip ticket Noun 1. round-trip ticket - a ticket to a place and back (usually over the same route) return ticket ticket - a commercial document showing that the holder is entitled to something (as to ride on public transportation or to enter a public entertainment) and $25 for each one-way trip. International trips will earn agents a 5 percent base commission rate with a maximum payment of $100 for each round-trip ticket or $50 for each one-way trip, the Minneapolis-based airline said. United Airlines estimates a 3 percent cut in commission will save the company about $150 million a year in commission costs, the airline said in a statement. The company refused to say if the savings in commissions would be passed along to its customers in the form of lower ticket prices. Sandy Price, an agent with World Corporate Travel, said the change in commission rates will dramatically cut into the Woodland Hills-based company's profits. At 8 percent, the agency would make $32 on a $400 ticket; now, with the new rate structure, the agency receives $20. ``Forty percent of our profit is cut, but our overhead including rent and salaries isn't,'' said Price. To save their businesses, agents have started to institute added fees for writing or rewriting re·write v. re·wrote , re·writ·ten , re·writ·ing, re·writes v.tr. 1. To write again, especially in a different or improved form; revise. 2. tickets, booking hotels or rental cars and processing refunds. To help offset the loss of revenue from airline tickets, many travel agencies are looking to corporations for business. Groups and corporations will always need travel agents to help them book their company weekends, said Price. Another lucrative market is the cruise industry, where commissions remain 15 percent. Unlike the airline industry, agents are able to negotiate contracts with cruise lines
Name Headquarters A'rosa Europe NCL America America AIDA Cruises Europe American Cruise Lines America that result in a higher commission for agents, added Maroney. CAPTION(S): Photo Photo: (Color) Rhonda Maroney, owner of Help Me Rhonda Travel in Chatsworth, says the airlines' move to cut commissions will force her to raise fees. Phil McCarten/Staff Photographer |
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