Travel Matters - August / September 2015

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manager. Lufthansa has in fact forced the
hand of the travel buyer to choose another
airline, including those who have publically
stated that they will not follow the GDS
fee route. It is clearly a disruption to the
booking process that TMCs will need to
factor in to all transactions.
Sensible business leaders call upon
trained experts and specialists to support
their organisations in all manner of industry
sectors. However Lufthansa’s decision is
suggesting that businesses can achieve
cost savings if they ask their people to cut
out those experts and book travel directly.
This is really short sighted. Sure, there
might be some immediate small savings,
but in the long term the business impact
– and cost – will be hugely detrimental.
TMCs provide valuable advice, insight
and management information; the kind of
consultancy that aids businesses with their
growth, helps them be more strategic and
empowers change.
Is this worth the €16 per transaction
Lufthansa wants to charge? Definitely not,
it is worth a huge amount more. In fact,
that is where Lufthansa has got it wrong.
They have severed trust with a reliable
and profitable distribution channel, and
significantly undervalued the role of third
party distribution in their attempts to
cut costs. Plus, it seems to be acceptable
practise to Lufthansa to transfer their cost
of doing business to the customer.
In the face of this challenge, Lufthansa
now has an opportunity to reconsider
how it will react when facing the travel
management industry. Third party
distribution channels will always prove
their value - whether that’s on cost
efficiencies, technological support or by
continuing to provide excellent service. If
Lufthansa is in the business of selling travel
for the long haul then they can only win
back points – and much needed business
support – by working in partnership. The
business travel sector is always willing to
help those who recognise their value.
LUFTHANSA CHANGES
THE STATUS QUO
Lufthansa’s recent decision to add a
surcharge of €16 to fares booked via a GDS
continues to cause much frustration and
debate in the business travel industry. The
full fall out won’t be known until later in
the year when the longer term impact of
the levy will be clearer.
The decision to attempt to circumvent
the established model of using a GDS is
somewhat understandable for a business
under pressure to cut costs across the
board. However, this move is to the
detriment of Lufthansa themselves,
their customers and business partners
– particularly travel buyers whose roles
and reporting rely on the additional
services that are powered by the GDS. It
is quite staggering that Lufthansa doesn’t
understand, or doesn’t want to accept, the
value that the GDS’ deliver to them.
While Lufthansa’s decision may have
been to encourage direct bookings from
both the business and leisure market, the
move doesn’t do much to entice the travel
TRAVEL TRENDS | 07
Lufthansa’s decision to levy a surcharge for fares booked via a GDS makes it
anything but business as usual, says Paul Wait, Chief Executive of the GTMC