Travelport to AA - Its My Party...

The latest missive between the warring parties looks set for a tit for tat battle.

The latest email from Travelport to their technology partners and agency subscribers is as follows:

I provide this as a public service without comment. TEXT FOLLOW

American Airlines Surcharge Update

16 December, 2010

Dear Valued Customer,

American Airlines’ (AA) recent attempt to withdraw the ability of a large travel agency in the United States to sell its tickets has prompted Travelport to take a number of actions to defend travel agents and consumers. It is regrettable that AA has taken action to attack the intermediary channel in the U.S. in what we believe is a first step in its attempt to reduce transparency and effective choice for consumers worldwide.

In response to actions by Travelport to defend the ability of travel agencies to access and book clear and complete content, AA has issued a letter to travel agencies indicating it will apply surcharge fees to Travelport agencies for bookings made on or after 20 December 2010. AA has stated that you will need to absorb these costs or pass them along to your customers. Through this action, AA is penalising the very people who deliver valuable revenue to AA.

AA intends to apply variable surcharge fee levels on a country-by-country basis as identified in their surcharge list and intends to invoice affected travel agencies via agency debit memos (ADMs). Travelport supports the industry in its contention that the use of ADMs for this purpose is not within the bounds of IATA Resolution 850m.

Should AA go ahead with the action its plans, Travelport would like to advise you of the actions and solutions we are implementing in our GDS platforms from 20th December.

First - In order to avoid any surcharge from AA for existing bookings, we recommend ticketing on or before the close of business on 19th December.

Second - In the event that it is necessary for you to offer to book AA, Travelport has developed processes to provide fare displays and quotations that include this surcharge fee from AA so that the total cost of the AA ticket can be provided to your customer. In most of these cases, the surcharge fee can be automatically remitted to AA without the ADM process. In Europe, this is a legal requirement in order that Travelport complies with its display obligations under the CRS Code of Conduct Regulations.
• Surcharges Will Be Included in Price of AA Plated Tickets – The applicable AA surcharge fee will be inserted into the price of AA plated tickets only, generated as a miscellaneous tax (YY). AA will receive these funds automatically through the BSP airline settlement process.
The placement of the surcharge fee in the YY ticket tax box makes use of a standard industry process and there should be no impact to your current processes, including your back-office accounting and reporting. This also minimises the need for your agency to create exception processes. Your agency efficiency levels remain intact with no need for work-around processes, special agent training, etc.
• Surcharges Will Not Be Included in Price of Non-AA Plated Tickets – Should a ticket plated on another carrier contain one or more AA segments, the surcharge fee will be included in the shopped pricing, but will not be included in the Travelport generated ticket and an ADM will be issued by AA.
In order to cover anticipated surcharge fees from AA when tickets contain AA segments but are plated on another airline, it will be necessary for you to recognize that YY surcharge fees are not included and apply your own business process to incorporate the surcharge fee into the customer’s service charges.
Where you issue a ticket plated to a carrier other than AA but where there are flights operated by AA (codeshare), it is our understanding that the AA imposed surcharge fee will not apply. However, it is not entirely clear to us at this stage how AA plans to handle its codeshare arrangements.
For additional information on these solutions, please consult PA1115 in ASK Travelport.

Travelport believes the approach we have taken allows the true cost of booking AA to be shown at the point where the buying decision is made, so your customers can make an informed choice about which carrier to fly. Our intent is to deliver upon our commitment to a pro-competitive and pro-consumer marketplace where travellers and travel professionals can shop, compare, and buy travel in whichever channel they choose.

We regret any disruption caused to your business – disruption which we have sought to minimise as illustrated above – and we thank you and your colleagues around the world for the overwhelming support we have received for the position we are taking in this matter.

Best Regards,



Kurt Ekert
Chief Commercial Officer