Tunia Cherian George

Mumbai, March 17

EVEN as more airlines join Air India in its plan to reduce travel agent commissions from May 1, the agents have threatened to suspend ticket sales of the national carrier, as a first step.

Singapore Airlines is the latest to join the list of airlines deciding to cut commissions to 5 per cent from the existing 7 per cent.

According to Mr Balbir Mayal, President, Travel Agents' Association of India (TAAI), the association had received a letter from Singapore Airlines, informing its decision on Thursday. Singapore Airlines joins Air India, British Airways, Air France, KLM, and Lufthansa, in deciding to cut commissions.

According to Mayal, A-I would be their prime target, as it was the national carrier that had made the first moves to lower rates this time round.

"We are disappointed with the airline and will go on the offensive against it by suspending sales of A-I tickets," he said.

He added that the association had targeted Lufthansa last year, when the German airline had made moves to bring down the commission rate to 5 per cent then.

Other carriers such as Austrian, Swiss and Alitalia were also expected to join suit, he said.

According to a travel agent in the city, the Far Eastern carriers were also keen to cut commission rates. He expected that the agents would have to give in and accept a lower rate of commission in the changed circumstances.However, while the airlines were expected to reduce commission rates by 2 per cent, the commission was unlikely to be scrapped entirely for sometime yet, he said.

According to an airline official, the current move to reduce commissions comes at a time when airlines across the world are trying to cut costs on all fronts. "We are looking at reducing costs across the board. So, how can distribution costs alone be exempted," he asks.

(This article was published in the Business Line print edition dated March 18, 2005)
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