26 May 2017

British Airways imposes surcharge on tickets not booked through NDC connection

British Airways and sister carrier Iberia are to levy a £8 fee on every fare booked on systems not using an NDC-led connection.

The surcharge will come into force from November this year, the pair told agencies in a letter today (Friday), covering fares in all cabins and classes.

Other channels that are exempt include its own website, airline sales offices and call centres, as well as the following channels:

  • NDC direct connection
  • NDC via an IT service provider/aggregator
  • Self-booking tools connected to BA or IB via NDC
  • IAG Booking Portal (to be available shortly)
  • Other travel intermediaries, including GDS, that adopt NDC based connections in the future

The fee is being set to recover “the additional costs applied” on existing distribution channels – namely the Global Distribution Systems.

The announcement comes almost two years to the day since fellow European carrier Lufthansa unveiled its plan to add a tax to any booking made through Travelport, Amadeus and Sabre.

The letter to agencies says:

“Our distribution strategy is focused on providing an enhanced range of booking options to our partners.

“We will continue to work with the GDS providers to distribute our content to our valued agency partners via existing solutions, however these systems and their traditional technology solutions currently carry significantly greater costs to BA and IB.

“We are also continuing to work with the GDSs on potential NDC connectivity.”

The threat of another major carrier joining suit has been mooted ever since Lufthansa’s move in 2015, with IAG-owned BA considered the most likely to move next given that a number of its executives had sat on the original IATA-led NDC committees.

BA says to agencies that it appreciates the introduction of a fee “represents significant change for your business”, thus the four-month period before it goes live in November.

The airline says the NDC standard “enhances the capability of communications between airlines and travel agents”, in particular regarding access to “full and rich air content”, “product differentiation” and a “transparent” booking process.

Those that continue to book BA/Iberia tickets through traditional channels will be automatically charged as part of the ticket, with a line item noted in the fare quote.

IAG family members, Aer Lingus and Vueling, are not affected by the changes.

Speaking to Tnooz during Travelport’s recent first quarter 2017 earnings call two weeks ago, CEO Gordon Wilson said of the rumoured addition of a fee:

“We have good faith talks going on and there’s nothing that they say they want to do which they can’t already do with Travelport.

“If they have an NDC protocol we are quite happy to write to it to connect some or all of their content.

“Surcharge would be a bad move and a retrograde step.”

In a follow-up to agency customers this morning, Travelport’s managing director of agency commerce, Jason Clarke, says the move is “the equivalent of a travel agency APD [Air Passenger Duty] seeking to penalise consumers who enjoy the benefits of choice, efficiency and value by booking through the travel agency medium”.

“They will be penalised both through this surcharge and the potential introduction of less efficient working practices.”

NB: British Airways image via BigStock.

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