After eight months at the bargaining table, Iberia Airlines and Spain`s federation of travel agency associations (CAAVE) have reached…
After eight months at the bargaining table, Iberia Airlines and Spain`s federation of travel agency associations (CAAVE) have reached agreement on a new agency commissions system that will be introduced gradually starting on January 1, 2004. On that date travel agencies and Iberia`s own ticket sales units will begin to charge customers for the issuing of tickets and the services the customer demands without meaning that this will necessarily increase the price, given the new commission structure. This model is being applied successfully in countries like the United States, Canada, Mexico, the United Kingdom, Ireland, and in Scandinavia and it gives the client access to more competitive and advantageous market prices.
The new system, which is to be introduced over an 18-month adaptation period, will bring about a gradual reduction of agency commissions, which will come to 1% in July 2005.
For its part, the Spanish airline has made a great effort in developing technical means to facilitate the issue of air tickets by agencies under the new commission structure. In addition, the agreement reached between Iberia and CAAVE opens a new chapter in their relations, covering several areas of commercial cooperation, communication, and customer service.
Iberia has been mindful of the latest demands of the travel agencies, and the latter have understood the necessity of adapting to the industry`s new competitive environment. Together they designed the new commission structure model which is very advanced with respect the those now existing in Europe and will bring major cost savings to the company and help it meet the objectives set out in its strategic plan.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
