Tackle fare unbundling travel buyers tell government

8 December 2011

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8 December 2011 | Angeline Albert

Corporate travel buyers believe the UK government should do more to tackle the issue of fare unbundling in the aviation industry.

Some 77 per cent of the 82 business travel purchasers in the UK & Ireland who responded to a survey by the Institute of Travel & Meetings (ITM), said the government is not doing enough to address the transparency issues facing buyers who pay for hidden ancillary charges on top of flight fares offered by airlines. An increasing number of airlines are now splitting up fares, with charges for items such as baggage and other items falling outside traditional business travel systems.

“These results provide us with a very clear indication of the buyer sentiment at this time,” said ITM board director Mark Cuschieri. “They want better engagement from government and NGOs who create policy affecting the business travel community as there are numerous areas.”

Some 80 per cent of travel buyers also feel business aviation is taxed too highly.

ITM members believe the European Commission (EC) is more engaged with stakeholders than the government on the subject of greater transparency and competition surrounding ancillary fees.

The EC is considering amending EU law to force the airlines to file all their fares including ancillary charges with global distribution systems to foster greater fare transparency and value for money. Its consultation with airlines, businesses consumer groups, GDS operators and travel management companies is expected to end in January.

Paul Tilstone, CEO at ITM, said: “At the moment the legislation is ambiguous. The airlines must file their fares with all global distribution systems but it does not mention ancillary fares.”

He added: “The ITM has been knocking on government doors to get support for buyers. The government can engage more in EC’s work to address this or look at changing UK law.”

ITM’s Industry Affairs Group, which published the results of research on buyer attitudes today, worked with ITM’s partner GBTA Europe to gather pan-European research from 102 of GBTA’s buyers. ITM represents more than 1,000 buyers and suppliers with a travel and meetings spend in excess of £34 billion per annum.

UK wide
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