You`ve to pay air travel agents` commission

Mumbai: Domestic and international airfares are set to rise by 5 per cent beginning October as the travel agents prepare ground to recover 5 per cent commission on the base fare: Amount parted to them by airlines for booking tickets on their distribution systems from consumers.
Domestic carriers Jet Airways and Air India shot off letters to the travel agents mentioning severance of this commission on Thursday. Kingfisher Airlines is reported to be planning to do the same soon.
The impact of the move would be an additional Rs 200-1000 (based on current ticket cost) plus service charges per ticket on domestic and international sectors adding to the escalating costs of air travel in recent times that has almost made air travel out of reach for a majority of first timers. Airlines have already made six revisions in airfares since the beginning of the year.
Almost 80 per cent of the airline ticket inventory is sold through agents in India. And airlines as a measure of cost cutting are saving on costs given to the agents as commission per ticket. Airlines on domestic distribution system will save Rs 500 crore from the move.
The total value of consolidated air tickets issued on an annual basis in India is between Rs 34,000-36,000 crore and if calculated, five per cent commission will amount to Rs 1000 crore on 60 per cent commissionable basis of Rs 21,600 crore, which both the international and national carriers will save cumulatively.
29/06/08 Manisha Singhal/Business Standard

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Categories: Indian Aviation- In General Jun 2008