Fears of fragmented air travel market allayed

27 January 2011
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27 January 2011 | Angeline Albert

Fears of a fractured market for travel buyers are being dismissed as a dispute in the US nears settlement.

American Airlines and SabreHoldings have agreed to suspend litigation surrounding their airfare distribution agreement.

During the suspension, the organisations have agreed to operate as they had been prior to when the conflict between them began, while they work towards a new airfare distribution agreement.

The agreement means travel buyers will benefit from a fully transparent view of airline data on Sabre, one of the world’s largest global distribution systems, including American Airlines travel information.

The litigation had sparked fears of a fragmented travel market caused by the possibility that American Airlines would bypass GDS and sell airfares directly to travel buyers.

“Ultimately, business travel buyers would foot the bill for marketplace fragmentation, so we’re pleased to see their voice is being considered and that American Airlines and Sabre are working together to find an approach that will work for everyone,” said Mike McCormick, executive director at the National Business Travel Association, whose members include corporate and government travel managers.

The suspended litigation relates to the terms of the airfare distribution agreement between the two firms, which is set to expire in September 2011. The two companies have agreed to put legal action on hold until 1 June 2011.

American Airlines said in a statement: “American Airlines and Sabre will begin work shortly in an effort to reach a new agreement. Both parties will return to operating as they were prior to 5 January 2011, in terms of Sabre displays, American Airlines content and economic terms.”

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