Carlson Wagonlit Travel on Wednesday said its year-over-year global sales volume grew by 16 percent, to $15 billion, during the first half of 2008, but president and CEO Douglas Anderson described general weakness in the United States that the company also is beginning to see in Europe.
During a conference call with reporters, Anderson said year-over-year "same store" sales--excluding new or lost accounts--fell by a low, single-digit percentage in the United States during the first half. After the summer holiday period, growth in Europe was "not negative" but was slower than in the first half of the year. First-half transactions in Europe were up more than 10 percent year-over-year, he said. Anderson also referred to "CWT-specific" issues in Asia-Pacific, including "client turnover" in Australia and exposure to the financial sector in Hong Kong.
New client wins in the United States helped offset the slowdown in base business, said Anderson. CWT reported 7 percent year-over-year sales growth in North America, as well as first-half sales growth in all other regions: 37 percent in Latin America; 24 percent in Europe, Middle East and Africa; and 14 percent in Asia-Pacific. The fastest-growing nations were China at 39 percent, Russia (28 percent), Italy (25 percent), Singapore (24 percent), Argentina (22 percent), Germany (19 percent), Brazil and Spain (18 percent), Austria (17 percent) and India (13 percent).
CWT also said it "currently services two-thirds of the FortuneGlobal 100," and named new clients, including Michelin and Schneider Electric.
Meanwhile, Anderson talked about CWT's rift with United Airlines. CWT in July canceled its international agreements with United Airlines after United canceled the U.S. agreement it had with CWT in June--after a report in The Beatindicated that United planned to slash $100 million in incentive commissions. CWT and United still have not come to terms.
Despite discussions with United to establish a "reasonable" incentive agreement, "We're not there yet," said Anderson. "We have shifted a substantial amount of traffic away from United. What we have not done is shifted traffic at the expense of our clients. [For] clients that have negotiated rates with United who have asked us to move away from 'de-preferencing' United for their business ... we have done that with immediate effect. We are still shifting business away from United when all else is equal. Where there are markets served by United as well as other major carriers, and scheduling and pricing is as good for our clients, we have taken business away from United in favor of primarily one of the other big four U.S. carriers.
"We will continue to do that until we have a preferred agreement with United," Anderson continued, adding that client transaction fees are not impacted.
Separately, Anderson described a handful of technology initiatives that CWT is undertaking, including the creation of an "interactive" traveler itinerary solution, agent desktop technology and a hotel-booking tool for European clients.
A pilot program of the new itinerary--"designed to enhance the traveler experience with relevant, up-to-date information on flights, hotels and destination services"--is underway in France, Spain, Switzerland and the United Kingdom, CWT said.
The hotel-booking tool "is a European client-specific project built from CWT Horizon hotel booking technology," according to a spokeswoman. "It will not be for North American clients because they are already covered by either CWT Horizon and/or third-party booking tools that CWT supports."