GDSs, Buyers Decry Air Canada Fare Shift

After removing certain fare categories from global distribution systems early this month, Air Canada found itself the target of punitive measures by GDSs and a mounting wave of peeved travel buyers and industry associations that reached a swell last week. Without warning, the carrier early this month began shifting bookings of lower-bucket Tango fares to its Web site.

Although Air Canada in a statement said it restricted bookings of Tango reservations because GDS technology "does not support the new features of Air Canada's simplified fare products," agents can still view Tango fares on the GDS.

While an Air Canada spokesperson would not disclose the percentage of seat inventory no longer available for GDS bookings, he said it affects Tango fares "for travel within Canada and between Canada and Florida." Tango comprises fare categories R, K, N, P, G, E and T.

Air Canada president Montie Brewer last week during the carrier's earnings call said that the decision resulted from a strategy initiated three years ago when the carrier began matching LCCs in the Canadian market and unbundling services. Days prior to pulling content from the GDSs, Air Canada further unbundled its economy product when it launched GO Discount, which reduces ticket prices for Tango ticket-holders not checking baggage. Air Canada said GDSs could not facilitate such bookings.

"We pulled the Tango content out basically because we have new attributes coming onto the Tango fare," Brewer said. "We now offer customers the opportunity to save money if they choose not to check a bag and more attributes will be coming down the line. It's a little irritant now, but will it be a major problem going forward, and we just can't afford not to have this product distributed properly in the marketplace. We've taken it out of the systems, which we are allowed to do under the contract, and we are now in discussions with them to find ways to distribute our product correctly."

Air Canada said it would reinstate the fares through a third-party channel "when one is able and willing to offer its subscribers the same level of functionality and merchandising capabilities as the Air Canada Web site."

Others disagreed. "It is important to note that this is not a technology issue," Sabre said in a statement."Travel agents have been selling the Tango fares in the Sabre GDS for some time now—up until the night before Air Canada removed these fares."

Added Business Travel Coalition chairman Kevin Mitchell: "Contrary to Air Canada's spin, there are no technological limitations involved in loading these fares into GDSs. The only technological problems have come from Air Canada deliberately throwing sand in the gears of managed travel programs through this unfortunate and unwise move."

GDSs struck back at Air Canada as Sabre and Cendant's Galileo biased displays of fares or removed inventory altogether. Sabre discontinued displays of higher fare products, and late last week, Galileo removed Tango fares from display. "At the same time, outside of Canada and the E.U., unless specifically requested, Galileo no longer will return Air Canada results in low-fare shopping calls," the GDS said.

Sabre added: "While we have taken some actions to address the situation, we are, most focused on working with Air Canada to restore access to full content."

"The full range of Air Canada's fares continues to be available at aircanada.com for consumers and travel agents," the carrier said in a statement. "We are aware of some of the GDSs' actions. With the exception of Tango fares, the full range of Air Canada's fares continues to be available for sale through all other third-party distributors. We have no further comments to add on any actions by GDSs."

Canadian Alliance of Business Travel president Tanya Racz said that since the carrier has "somewhat of a monopoly of corporate travel here, many of our buyers have an agreement with Air Canada." She said that some Canadian travel buyers would not be affected as they have opted to go with higher-bucket Tango Plus fares, while others—especially those with lowest logical airfare policies—would have to revise programs and policies. Racz noted that many of the alliance's members also were frustrated with the timing of the announcement, noting, "Some warning would have been nice."

The BTC last week sent a letter to Brewer signed by 46 corporate customers—including DaimlerChrysler, Deutsche Bank, General Motors, Lehman Brothers, Black & Decker and Weyerhaeuser—saying the carrier's move will lead to higher prices, additional administrative costs and would encourage other airlines to "implement similar disruptive policies."

ASTA condemned the withdrawal of low-fare inventory, saying it "impairs the efficiency of travel agencies and limits consumer choice of preferred channels for buying air travel." ASTA lambasted not just the decision, but also how it was relayed. "The decision was implemented in the middle of the night on Monday, May 1, and agents were confronted with the results the next morning without the benefit of any explanation of what had been done."

GDSs also said little warning was given. "Air Canada did not provide notice to Sabre of this measure until the evening prior to pulling the content, leaving us with no opportunity to notify our customers so they could take appropriate measures to protect business operations," Sabre said.