<B>InsideTrack</B>
<B>Delta Enhances Online Agency Site</B>
Delta Air Lines today announced enhancements to its Online Agency Service Center, including the ability for all agents and CTDs with Airlines Reporting Corp. numbers to book special Web fares. Delta said the booking capability was added as a result of agency demand. Agencies will not earn commissions for booking Web-only discounted fares and any bookings will not count toward override agreements, but they can book published fares through the site and earn commissions. Corporate rates will not be included on the agency site, which complements Delta's direct corporate online booking module also available through delta.com. The OASC was introduced last year and supplies agencies with rich informational content not available through any other channel. Delta is targeting online revenues from all delta.com modules--corporate, agency and consumer--to reach $1.4 billion for 2001.
<A NAME="2"><B>Growing Number Of Hotel Projects Being Put On Hold</B>
Bear Stearns lodging industry analysts last week reported that 320 hotel projects, accounting for nearly 61,500 rooms, fell out of the development pipeline in the fourth quarter of 2000. This accounts for nearly 20 percent of the rooms in the active pipeline. Amid signs of a faltering economy generally, developers reacted to two specifics: a tighter financing environment and higher construction costs. For the hotel industry, diminishing supply growth is good news because it means there's a better chance demand for existing rooms will remain strong, if the economy falters. For travel buyers, of course, diminished supply is less good news.
<A NAME="3"><B>Marriott, Bass Likely Suitors For Grenada</B>
With the protracted auction process drawing to a close, it appears Marriott International and Bass Hotels & Resorts likely will prevail in their joint effort to acquire the hotel assets of London-based Grenada Compass. According to industry sources, Marriott will acquire the Le Meridien brand, while Bass will take control of the midprice Posthouse chain. On a related front, Marriott announced it will build up to seven hotels and/or resorts as part of a joint venture with upscale Italian jeweler Bulgari. The deluxe properties will bear the Bulgari name and be managed by a newly formed unit within Marriott called The Luxury Group, which also includes Ritz-Carlton.
<A NAME="4"><B>Financial Troubles Victimize Smaller Carriers</B>
Dallas-based Legend Airlines last week relinquished its operating certificate to the Federal Aviation Administration after less than a year of operations from embattled Love Field. A lengthy and expensive legal struggle against American Airlines drained much of the carrier's capital before it even took flight, forcing it into eventual bankruptcy last December. The Wall Street Journal reported Love Terminal Partners, operator of Legend's new state-of-the-art terminal, is seeking interested carriers to fill the void. It listed American, Delta and Continental airlines as possible replacements. Des Moines, Iowa-based AccessAir also ceased all operations earlier this month after failing to generate enough passenger revenue. It too had filed for bankruptcy protection late last year. Meanwhile, Las Vegas-based National Airlines earlier this month sent a letter to travel agents regarding potential financial backing that could lead toward a "successful emergence from Chapter 11," which it had filed for in December. Though the investor group was not named, the carrier added that recent booking figures are at record levels, particularly bookings within 60 days of travel, which are up 40 percent year over year. National has maintained its full flight schedule since December.
<A NAME="5"><B>SAS Barred From Rewarding Loyalty</B>
A Swedish court has upheld a ban on Scandinavian Airlines System awarding frequent flyer points on domestic routes where it is in competition with other airlines. The ban, which will take effect Oct. 27, originally was imposed last year by the Swedish competition authority, but SAS appealed. The significance of the decision could spread beyond Swedish borders. Competition authorities in Denmark and Norway, where SAS is also the dominant carrier, have said they will review their own rules in light of the Stockholm ruling, and the European Commission also will keep a watchful eye on the issue. Swedish Business Travel Association chairman Cathrine Wickerts welcomed the appeal rejection. "We see it as a first step," she said. "The market has been absolutely closed to new airlines, but this has opened the door for them." Wickerts wishes to see mileage programs scrapped altogether because she feels fares would be lower without them. The original competition authority ruling banned SAS from offering mileage on any domestic route. "It is the economic side we don't like," she said. "Everything should be contracted into the agreement between suppliers and corporates. We don't like these hidden elements.