US Airways this afternoon announced an agreement with Sabre effective immediately to provide Sabre-connected agencies with access to the airline's Web-only fares. In exchange, the airline will receive a 10 percent reduction in fees paid to Sabre--which is responsible for more than 50 percent of US Airways' global distribution system transactions--and a three-year freeze on fee increases.
Citing "angst" in the corporate travel community caused by pricing disparities and the increasing non-competitiveness of GDS prices that moved more airline fares toward the Internet, US Airways senior vice president of marketing B. Ben Baldanza said the airline will find respite from predicted "meaningful increases" in fees expected from GDSs during the next few years.
"This levels the playing field between online and offline distribution," Baldanza said. All Web fares, including those displayed on Orbitz, will be available through Sabre. Special "opaque fares," or those available through Priceline or Hotwire still will exist outside of this agreement.
Comparing this deal with American Airlines' partnership with TQ3 Maritz Travel Solutions
BTNOnline, Sept. 25 , which asks travel agencies to take on the GDS fees, Baldanza said, "It didn't take us five pages to discuss it, and we think it makes much more sense. It goes to the source of the expense and works the deal at that level." However, he said these collective efforts point the industry toward simplified pricing.
US Airways spends an estimated $125 million annually in GDS fees. After initiating talks with Sabre less than two weeks ago, Baldanza said the airline now has extended talks to other distributors.