United, TWA Hobble ID Code

<B> United, TWA Hobble ID Code</B>

By Amon Cohen

United Airlines and TWA have blocked the International Air Transport Association from mandating a universal client identification code system that would enable corporations to track their air volume.

Thanks to a veto from the two U.S. carriers at the IATA passenger services conference in Bangkok late last month, the system will be adopted as a recommended rather than a mandatory practice.

Interested carriers likely will meet this month to discuss putting the plan into practice, which will be adopted March 1, 2000. But the lack of unanimous support leaves companies without a unified coding system for gathering consistent information from all the airlines worldwide.

IATA also refused requests from travel agents to allocate a space on air tickets for an agency transaction fee to the client. Instead, IATA devised a voucher, similar to the one offered by the Airlines Reporting Corp. in the United States, that agents can attach to the ticket showing how much they are charging for the transaction.

The new identification initiative was IATA's second attempt to attach a code to tickets in an effort to help corporations track their air spend. The first proposal, which surfaced in 1996, was to print the client's code on the ticket itself. It failed largely due to fears about security. The new scheme would have codes inputted to the passenger name record through the GDSs.

A United spokesman said it vetoed mandatory introduction because it had a number of concerns. "One is confidentiality," said the spokesman. "There is a risk that it might reveal the United client base to other airlines. Also, we are not certain that this is what our clients want."

However, the corporations that BTN spoke with were clear it was what they wanted. "If it is limited to voluntary suppliers, that will not be as workable," said Huub Smeets, EMEA travel manager for IBM. As an example, Smeets cited KLM's two-year-old uniform client code. It helps the airline to present detailed transactional information to clients at the end of each month. "As long as it is KLM paper, sure, it works well, but that is a limitation if it cannot be used for other airlines," Smeets said.

As a major customer of United's Star Alliance partner SAS, Skanska travel manager Cathrine Wickerts also is unhappy with the stance taken by the U.S. carrier. Even though the four Star Alliance members with antitrust immunity will unveil a method for jointly tracking information in the new year (<I>BTN</I>, Nov. 1), Wickerts would like to see a universal system in place. "We need to have something like this to make true global agreements," she said. "How can we as customers be sure that the information they give us is correct?"

Another worried figure is Philipp Zuercher, head of supplier relations and procurement for BTI Central Europe, who has urged the Association of Corporate Travel Executives to take action on the issue. "On behalf of our clients, I want to see an IATA client identification defined and for it to be applied worldwide," he said. "At the moment, it is not difficult for us to identify the client if they book their travel through an implant, but it is hard if tickets are booked through a large reservations center. It will help clients identify volumes, and with the help of software that we give them they would be able to audit against the information supplied directly by the airlines. Until now, airlines have insisted on paying rebates based on their own figures."

IATA assistant director of passenger services Mike Muller said some airlines were uneasy about the scheme because they already had their own systems. "A lot of carriers have invested time and money in their own systems and it would be a pain for them to convert," he said. However, he was confident that the plan would accumulate critical mass in spite of being voluntary. "Oneworld is among those interested in such a system," he said. "If enough people want to make it work, it will work."

Agents and clients also will be disappointed by IATA's refusal to allow space on air tickets for an agency fee. According to IATA passenger distribution policy director Chris Gilbey, there are practical difficulties in finding space for the box on the ticket as well as legal objections. "Many carriers are opposed because it changes the real estate on a ticket. The ticket belongs to the airline and all the price elements listed on it are part of the tariff," he said.

The voucher, which is being offered instead of the box, will be introduced in January and will allow agents to show official documentation for their charges. It will be recorded and processed through the Billing and Settlement Plan, the IATA equivalent of ARC that is used by all travel agents in Europe.

The Guild of European Business Travel Agents still is hoping it can change IATA's mind on the issue. "Since more and more agents are charging a fee, it would be more convenient to have it all in one place and it would improve the transparency of the pricing," said GEBTA secretary general Wim Siebers.

In Scandinavia, which has seen the world's most severe commission cuts, many corporations and agents have adopted the practice of attaching an invoice to each ticket before handing it to the traveler. The invoice details ticket price, commission payment and agency handling charge, so travelers and budget holders can understand the true net cost of the journey.