More commission cuts from key carriers

zoom

Two more carriers have announced plans to slash agent commission to 0% in the UAE.

UAE flag carrier Etihad Airways will go to zero on January 1 and UK airline Virgin Atlantic will follow suit on March 1. The move by both follows Emirates Airline's decision to adopt a 0% commission model in the UAE from October 1, 2008.

"We have been talking to the trade about this for a long time and letters informing travel agents of this policy have already gone out," Etihad Airways vice president sales Adrian Parkes told ATN.

"A lot of the big travel agencies and travel management companies are already working with service fees anyway and a mixed model (with some airlines at 0% and others paying commission) was making life difficult.

"For those agents that are not working with fees as yet, we have given them a sensible lead time during which they can adapt."

Parkes said Etihad sales staff would be running workshops on fee-based models and how to adapt to a 0% commission environment at agencies throughout the UAE in the lead up to January 1.

"This changes the agency's business model and its relationship with its corporate clients, but as long as they are providing a quality service and adding value, they shouldn't have a problem," he added.

Virgin Atlantic regional manager for the Middle East Andrew Fyfe said the carrier had been holding back on commission cuts because as a relative newcomer to the market, it needed to foster strong relationships with the UAE travel trade.

"[However], considering that the national carriers of both the UAE and the UK all going to 0%, we think the time is appropriate for us to go to zero as well," he said.

Fyfe said Virgin had learned from other airlines that effective communication with agents was the key to a successful changeover to zero commission.

"Within the next three or four weeks we will start the process of writing to every single travel manager, every single travel agency and laying out our plans," said Fyfe.

"They should be left in no uncertain terms as to how we are going to approach this."

Print | Email | Discuss this article

| Share |

READERS' COMMENTS

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic. Arabian Business would like to point out that only comments relevant to the story will be published. Any containing personal insults or inappropriate language will not be approved.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Enter the words above *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM