1 Sep, 2015
Two separate announcements on Aug 31 have led to some head-scratching over the status of Lufthansa’s Distribution Cost Charge.
An announcement by the Travel Agents Association of India, published in the BreakingNews website quotes Mr Marzban Antia, Hon. Treasurer & Co-Chairman (Airline Council) as saying that a letter has been received from Lufthansa boss Will Wolfgang asserting that “Effective September 1, there will be parity in fares between the GDS and our website.” The item was headlined: “TAAI convinces Lufthansa to scrap web disparity.”
However, also yesterday, Lufthansa’s website published a media release saying it was going ahead with the DCC. The release said: “As planned, the airlines of the Lufthansa Group are now taking a further major step in implementing their new commercial strategy by ensuring that from tomorrow (1 September), the costs of bookings made via global distribution systems (GDSs) are met more fairly and transparently by the users involved. To this end, a new “distribution cost charge” (DCC) of EUR 16 will now be applied to any ticket issued via GDS.”
Here are both the statements and announcements. Some clarification would be in order.
TAAI convinces Lufthansa to scrap web disparity
After much deliberation and continued dialogue with Lufthansa Group, the Travel Agents Assocation of India (TAAI) has managed to convince the airline not to have web disparity in fares. Marzban Antia, Hon. Treasurer & Co-Chairman (Airline Council), TAAI, revealed this, adding, “We have received a written statement from Will Wolfgang on behalf of the Lufthansa group. This will be effective September 1, 2015. We are also in talks with other airlines on this major issue of web disparity and are confident that we will achieve success in the same as well.” The email to TAAI by Wolfgang Will, Director (South Asia), Lufthansa Group, stated, “The meeting was indeed very fruitful as concerns were addressed and ambiguities concerning the DCC were cleared. A key point raised at the meeting was the wider disparity between the fares reflecting on the GDS vs our website. Effective September 1, there will be parity in fares between the GDS and our website. We hope this change reflects a strong commitment from our side to foster an even greater partnership between us. Our thanks to the travel trade for the continued support and open communication.”
Lufthansa Group to expand direct booking channel options
31.08.15 – Broad interest in alternative distribution channels; numerous collaborations with technology providers – More transparent and balances pass-through of costs of bookings via global distribution systems from 1 September
The airlines of the Lufthansa Group – Austrian Airlines, Brussels Airlines, Lufthansa and SWISS – have reached a major milestone in their endeavors to modernize their present product structures. A number of collaborations with various partners in the airline distribution segment have been successfully pursued over the last few weeks.
The efforts to develop and establish new “direct connect” booking channels are generating strong interest among the industry partners. “The market is clearly ready for innovations and developments of this kind,” confirms Jens Bischof, Member of the Executive Board and Chief Commercial Officer of Lufthansa German Airlines. “Our realignment of our distribution has prompted an intensive exchange of views and experiences within our industry.”
“This process has had its share of controversy, too,” Bischof concedes. “But we are still as convinced as ever that offering advanced and, at the same time, substantially cheaper additional booking channels – that also allow us to better present our products – is in our customers’ best interests. And that’s why we consistently pursue the further development of our distribution channels.”
As planned, the airlines of the Lufthansa Group are now taking a further major step in implementing their new commercial strategy by ensuring that from tomorrow (1 September), the costs of bookings made via global distribution systems (GDSs) are met more fairly and transparently by the users involved. To this end, a new “distribution cost charge” (DCC) of EUR 16 will now be applied to any ticket issued via GDS.
Customers of the Lufthansa Group can obtain their tickets without having to pay the new DCC by making their bookings via the member airlines’ websites, via an airline service center or at an airport ticket desk. Travel agents may also use the dedicated www.LHGroup-agent.com online portal as a booking alternative.
Corporate customers can continue to make their bookings at their individually-agreed contractual rates (i.e. with no DCC) via www.LH.com. Lufthansa has also concluded a new agreement with technology provider Concur, an SAP company, under which Concur will provide the Lufthansa Group’s corporate customer travel management units with special programs for managing these www.LH.com bookings from next year onwards.
“We want to work together with the travel agents and the global distribution systems to make the sale of air tickets more up-to-date, more inexpensive and more customer-minded,” Lufthansa CCO Bischof emphasizes. “And to this end we have swiftly developed a range of IT solutions that will be offered to our customers in the near future.”
The airlines of the Lufthansa Group have been particularly active devising solutions together with key technology partners that will enable them to develop and offer new “direct connect” booking channels. Parallel to this, the airlines are working on providing booking platforms for key-account corporate clients which will give them and their corporate travel agencies direct access to the air travel products of the Lufthansa Group.
Deutsche Lufthansa AG, Lufthansa Group Media Relations