Pune travel agents protest Air India plan to use one GDS

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Pune | Published: December 15, 2018 3:12:59 AM

The Pune chapter of Travel Agents Association of India (TAAI) and Travel Federation Association of India (TAFI) held a protest march against the national carrier, Air India, and its plans to align with only one Global Distribution Partner (GDS).

air india, aviation sector, aviation industryAccording to agents, the reason given by Air India management was that it would help them reduce distribution cost by almost 60%

The Pune chapter of Travel Agents Association of India (TAAI) and Travel Federation Association of India (TAFI) held a protest march against the national carrier, Air India, and its plans to align with only one Global Distribution Partner (GDS).

Air India had decided to use Travelport as their exclusive GDS and is giving up the rest of systems. This means that if a travel agent wants to book tickets they have to be on Travelport GDS which they said restricted AI’s as well as their business.

The national carrier had been using multiple GDS systems so far but had now decided to use just one.

According to agents, the reason given by Air India management was that it would help them reduce distribution cost by almost 60%.

Full service airlines, such as Air India, Jet Airways, have to rely on GDS providers like Amadeus, Travelport and Sabre for sale of tickets in India and abroad. The GDS provider collects a segment of fee for every booking and shares a portion with the travel agent. By restricting GDS to only one provider, it might reduce costs but will reduce the catchment area of passengers to only members of that GDS and Travelport had only 20% of global and 30% of domestic market, the protesting agents said.

The agents carried out protest at the Air India office in Pune saying AI was making a blunder in sales and marketing by creating a monopoly as it is looking to align with only one GDS.

“While the most famous GDS systems globally are Amadeus, Sabre and Travel Port — all major airlines must necessarily be on multiple GDSs because if they are only with one they are automatically blocked from others. According to the agents, there are three major GDS players in India with Amadeus having a 55% share, followed by Travelport (30%) and Sabre (12%) .

“Agents earn incentives from service providers and the airline’s decision will hit them hard. It will also disconnect about 18 codeshare partners and over 100 inter line partners. It will also lead to loss of business from Star Alliance Partners, a membership that Air India got with difficulty. Further, it will exclude Air India from large global online players like Expedia, Odigeo, Egencia and others as they do not work with Travelport. It is also understood that GDS companies have proposed alternative strategies with reduced costs to avoid this exclusivity by Air India,” Nilesh Bhansali, director, Travel Agents Association of Pune, said.

They pointed out this decision to shift to a single GDS platform was opposed by its previous chairman and managing director Rajiv Bansal and commercial director Pankaj Srivastava.

They felt that shifting to a single platform may curtail the airline’s market reach that would lead to loss of bookings.

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TAAI objected to AI’s move to select a single GDS service provider as it will hurt their revenue. They also pointed that Travelport in India was being controlled by Interglobe Group, the owners of IndiGo Airlines, which was a rival of Air India and could lead to a conflict of interest.

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