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CAL in fare cost-cutting
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| Published on Tuesday, March 10, 2009 |
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Cayman Airways has introduced what it describes as a proactive operational cost-saving measure to help keep airfares as low as possible for customers.
CAL stated in a media release that effective 1 April 2009, the airline’s travel agent commission of 10 percent per ticket sold will be reduced to 6 percent. While this new rate is still well above that which is currently being paid to local travel agents by competing airlines serving the Cayman Islands, Cayman Airways CEO Designate Olson Anderson said this new structure aims to ensure that airfares remain affordable for travelers.
“For over a decade airlines worldwide have been reducing commission payments in order to reduce the cost of air travel,” Mr Anderson said. “This new structure will ultimately benefit the customers that both Cayman Airways and local travel agents serve, and we look forward to continuing to work closely with our travel agent partners.” | | | | Reads : 959 |
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Charles Ebanks:
In regards to commissions for travel agents; in virtually every other market in North America, airlines have suspended standard commission rates to travel agents. These agents have then instituted fees to their customers for the service offered. This change in business process allows customers to use that service if they need assistance. However, most customers now use online services (like Sidestep.com, Orbitz, etc.) that allow price comparisons, and ability to look at alternate dates for travel for savings, etc.
These online services are free or have a nominal charge ($5 U.S. with the larger companies) for booking and paying for a ticket. Hand written tickets (which take time) are not the standard; in fact, it is very difficult to find instances where airlines even accept those types of tickets. Electronic tickets make part of the agency experience irrelevant.
Instead of attacking Cayman Airways for lowering commissions from ten percent to six percent, perhaps the agency community in Cayman should join the rest of us in the 21st century and also thank Cayman Airways for not decreasing the commission rate to zero like it is in other markets. Cayman Airways sells a remarkably high percentage of tickets online (internet) and could have just as easily stopped paying commissions at all. Perhaps Cayman Airways would reconsider since the agencies are now threatening not to sell KX at all ... that being the case; what's the point of paying the agencies anything.
Wake up travel agents, the government is actually paying these commissions to you as Cayman Airways requires subsidies to stay in business. Reducing agency commissions reduces government subsidies and that decreases the exorbitant taxation on the public. The public that doesn't even fly has to pay for commissions. That is just not right. |
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