United Ends CWT Preferred Relationship

United Airlines has terminated its preferred relationship with Carlson Wagonlit Travel amid efforts to trim agency incentive expenses through restructuring all of its agency deals.

"It's true that United has terminated our preferred status," a senior CWT official told BTN. "There's a fundamental difference in opinion. United's trying to reduce their cost of sales. We're puzzled that we would have such a difference in opinion over what would endanger their share of the highest yield revenue, but we will try to work through it."

According to several sources, United pulled the contracts of all of the mega agencies in favor of new contract terms, but eventually reinstated the other mega relationships. According to BCD Travel CEO Joop Drechsel, his agency's relationship with United "has returned to normal."

Though United senior vice president of worldwide sales Jeff Foland would not confirm the breakup with CWT, he said United has "reworked all of our contracts" with both leisure and corporate agencies, noting that one mega has fallen to the wayside. Foland said United is on target to save $80 million in annual agency commissions and incentives through restructured agency deals.