<B>Inside Track</B>
<B>BA To Announce End Of Commissions</B>
British Airways today will announce that it will abolish U.K. commission payments, and replace commissions with a booking fee--thought to be 2 to 3 percent--plus a sales and marketing bonus to its top 450 travel agents. The airline currently pays 7 percent commission plus a 3 percent interim bonus it introduced last summer after the European Commission forced it to scrap its override program. There also is speculation that BA will reduce its published fares to avoid accusations from corporate clients that this is a back-door price increase for them. As BTN went to press, there were frantic negotiations between the airline and agents over when the axe will fall. "Some hawks at BA are saying they should go for April this year to save some real money," said one agent, whereas the Guild of Business Travel Agents was holding out for April 2001. Jan. 1 is the most likely date. In the interim, the airline is likely to hold commission at 7 percent but drop the 3 percent bonus.
<B><A NAME="2">Buyers To Press SW To Offer Web Booking Access</B>
A group of corporate travel buyers will meet this week "in a heart-to-heart" discussion with Southwest Airlines to push the low-cost carrier to make its inventory available to the full range of online booking systems. Southwest traditionally has held down costs by handling its own bookings, though it does participate in Sabre, the nation's leading GDS. But travel managers have long felt that having Southwest inventory available only through the Sabre BTS and Oracle E-Travel systems is holding back the growth of travel e-purchasing systems (<I>BTN</I>, Nov. 15, 1999).
<B><A NAME="3">Midwest Express Pilots Set For Feb. Strike</B>
The National Mediation Board last week released Midwest Express management and the carrier's pilots into a 30-day cooling-off period following 18 months of contract negotiations. Should the Feb. 12 deadline arrive without an agreement, the 330 pilots employed by the airline and represented by the Air Line Pilots Association would be free to strike. The union overwhelmingly authorized a strike in a September vote.
<B><A NAME="4">Rise In Hotel Rates Expected To Stabalize</B>
What environment can travel buyers expect when they sit down to negotiate hotel rooms? Bear Stearns lodging analyst Jason Ader projects that the growth of average daily room rates industrywide will stabilize in the 3.6 percent to 3.8 percent range between 2000 and 2002. Meanwhile, declines in occupancy rates are slowing. These trends should mean a mild recovery for lodging companies, whose stocks have badly underperformed the S&P 500 for two years.
<B><A NAME="5">Galileo To Unveil Compliance Reporting</B>
Galileo International is about to roll out its Compliance Reporting Tool, an online, real-time intelligent interface to the passenger name record that allows travel managers to view bookings that have been made but not yet ticketed. Reviewing these reservations allows the travel office to check for noncompliance with corporate travel policy while there still is time to change the reservation without incurring an additional GDS fee.
<B><A NAME="6">Navigant International Heads to U.K</B>
Navigant International Inc. last week announced it acquired the London-based M.D. Travel Management Ltd., bolstering its presence in the United Kingdom. Navigant already had established a U.K. foothold through its acquisition of McGregor Travel Management (now referred to as Navigant International/Northeast). That office now will be combined with M.D. Travel Management, with $65.9 million in annual sales. Richard Furness has been appointed managing director, Navigant International/United Kingdom. Furness formerly worked as a regional sales manager for Hogg Robinson Travel and also was a director at London's Gray Dawes agency. Navigant president Tom Nulty said with the acquisition "we pick up some wonderful management and personnel." A Navigant spokesperson said to expect further acquisitions in Europe, which might include another U.K. purchase.
<B><A NAME="7">U.S, U.K. Resume Bilateral Talks This Week</B>
Negotiators from the U.S. Department of Transportation are due in London this week to continue discussions on aviation rights with their U.K. counterparts. Each side is entering the latest round of talks with a specific goal in mind. DOT is seeking Pittsburgh-London authority for US Airways, which has said it is ready to fill the void left by British Airways when it pulled out of the market. United Kingdom officials, meanwhile, are asking for swift resolution of the American Airlines-BA codeshare request.