Jet, Kingfisher to fly away with agents' commission

New Delhi: After national carrier Air India, other full-service carriers—Jet Airways and Kingfisher Airlines—are moving towards a zero-commission structure for travel agents.
These carriers are expecting to save around Rs 1,000 crore as commission payments to travel agents on air ticket sales. Air India and Jet Airways are expected to net Rs 450 crore each and Kingfisher will save up to Rs 100 crore. There are more than 8,000 travel agents in India, of which around 2,000 are affiliated to International Air Transport Association (IATA).
Air India, whose 90% tickets are sold through agents, has notified various travel agent bodies about a zero-commission deadline from October 1. Air India spokesperson Jitendra Bhargava said: “We will stop the 5% agent commission from October.
It is one of the measures taken to keep the airline healthy. We are looking at every aspect of cutting down other operation costs to remain viable and avoid financial closure.“
Travel agencies in various developed markets have adopted a service fee model , where they charge customers for ticketing services instead of charging commission from airlines.
25/06/08 Chanchal Pal Chauhan/Economic Times

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Categories: Jet Airways Jun 2008, Kingfisher Jun 2008