Effective Sept. 1, the Lufthansa Group -- including Lufthansa, Austrian Airlines, Brussels Airlines, and SWISS -- will charge $17.72 (16 euros) per ticket on flights booked anywhere other than its own websites, service centers, and airport ticket counters.
Announced early this summer, the surcharge is a response to fees Lufthansa and other airlines pay to distribution companies such as Amadeus, Sabre, and Travelport, which power third-party booking websites like Expedia and Priceline.
"Until now, the percentage of revenue generated from the sale of flight tickets by our airlines has continuously decreased," said Jens Bischof, Chief Commercial Officer of Deutsche Lufthansa AG. "While other service and system partners in the value chain are recording increasing margins and returns, our airline's earnings have been compromised over time, even though they are the actual providers of flight services. We want to counteract this trend by refocusing our commercial strategy."
The surcharge has not been well received by industry.
"Amadeus believes that the traveler is at the heart of the travel industry. Travelers today are looking for consistency, transparency, and choice across all channels and we as an industry can deliver that best by connecting and integrating all players," Amadeus said in a statement. "[Lufthansa] have chosen to go in a different direction by introducing charges that will penalize travelers based on the shopping channel they use. Travelers will either pay more for the same service or, in the case that travel agencies are forced to accept this new commercial strategy by modifying the way they access content just for [Lufthansa], there will be extra IT costs that may ultimately be passed on to the traveler, putting the travel agent, and/or the end consumer, at a disadvantage."
The Business Travel Coalition (BTC), a for-profit advocacy group representing airline distribution companies, has submitted a 10-page letter to Lufthansa and anti-trust authorities in Europe and the United States -- signed by 135 travel buyers, consumer groups, industry associations, travel agencies, and other stakeholders -- in which it "forcefully rejects" the airline's new surcharge.
"In the marketplace for airline distribution services, airlines and travel agencies of all stripes are direct competitors," said BTC President Kevin Mitchell. "By forcing the 16 euros surcharge on indirect channel participants, is [Lufthansa] using its dominant market position in both the marketplaces for commercial air services and airline distribution services to drive up the costs of its travel agency competitors harming them and forcing many to exit the market? Antitrust enforcers need to examine this question."
Check out the all-new MeetingNews Minute, featuring exclusive research on industry trends!