ARC Approvals Multiplying

<B> ARC Approvals Multiplying</B>
<I>CTD Ranks Grow To 18 During The First Half Of 1999</I>

By Sarah Welt


The number of Corporate Travel Departments is rapidly picking up steam, with the Airlines Reporting Corp. having approved five more CTDs by April 30, bringing the total to 13--a huge jump from the eight certified in the past. And ARC spokesman Allan Mut&eacute;n said he expects the total to grow to 18 in the May statistics, which had not been released at press time.

To better serve the emerging CTD market, the National Business Travel Association also is expanding its services by setting up a Corporate Travel Department council. Said executive director Norm Sherlock, "NBTA has always housed differing interests and provided segmented programs and special forums for groups with special interests within our ranks."

Meanwhile, Southwest Airlines last month said it is not paying commissions to CTDs. "They were told up front they wouldn't be paid," said spokesperson Linda Rutherford, "but they applied for and got the commissions anyway. We had to issue debit memos."

Southwest's stance has caused at least one company--Thomson Consumer Electronics--to rethink its interest in a CTD appointment. Said manager of corporate travel worldwide Cindy Heston, "I was considering it until I heard about Southwest not providing commissions. At this point I am in kind of a holding pattern." While Southwest is not a major Thomson supplier, "I have concerns that other airlines will pick up on it."

Heston has decided to wait about a month, during which Thomson's legal department will review the CTD option. "I am not interested in insourcing," she said. "We would just be more in control of what is going on."

Meanwhile, Bob Grant, vice president of corporate services at ARC-appointed CTD Charles Schwab & Co., said the Southwest news "doesn't make much difference to me because I am chasing net fares."

Grant said he has been approached by one corporation that wanted Schwab to handle its travel program instead of using a travel agency. While he turned down the offer--for now, at least--he said, "there would be some synergies available simply by sheer volume. Could I reduce my transaction costs further, could I use their volume to enhance my position with preferred vendors? If there is a way to do that I might be disposed to. But it is a very iffy might." In addition, he noted, "I would have to consider if that would require me to go back to being a full-service agency," as he was before the CTD designation was inaugurated late last year.