Lufthansa Expands Services With CheapOair Even as Airline Pursues Surcharge

Even as the Lufthansa Group proceeds with plans to level a surcharge for bookings that take place beyond its websites and call centers beginning in September, the airline group has expanded its relationship with one such third-party travel agency, CheapOair.

With the exception of the Lufthansa Group’s own sites, CheapOair states it became the first site globally to enable customers to make seat reservations in advance as they book Lufthansa Group flights, including those for Lufthansa, Swiss and Austrian Airlines. Travelers can also select seats on these airlines when booking over the phone through CheapOair’s parent, Fareportal.

The advance seat reservations aren’t free and are dynamically priced, says Fareportal chief operating officer Werner Kunz. This means that Lufthansa varies the prices of the seat reservations based on factors including whether the seat is for a senior, another adult or child and depending on things such as the route and time of day.

As on Lufthansa sites, CheapOair will offer passengers the optional service of paying for an advanced seat reservation for certain types of preferred seats whether they offer additional legroom, are positioned at the front of the economy cabin or come with priority boarding, for example. As before, travelers can select economy class seats for fee during check-in up to 23 hours before the flight.

Kunz says travelers can also purchase additional perks as part of the process, including seats with extra legroom.

In a second phase of the rollout with Lufthansa Group, CheapOair customers would be able to purchase advance seats and other perks based on frequent flyer status, Kunz says.

Lufthansa Group’s enhanced partnership with CheapOair, which also offers ancillary services from other carriers such as American, Air Canada and Spirit, comes as Lufthansa stunned the aviation and distribution industry with its plans to level a 16 euro ($18) fee on consumer flight bookings that occur on travel agency sites that use a global distribution system, which all of them do. Lufhansa is protesting global distribution fees, which the airline considers excessive, and is trying to drive traffic to its own channels by leveling a surcharge.

Is there a contradiction between Lufthansa requiring a surcharge on consumer bookings that take place on travel agency websites while the airline expands its relationship with one of the largest travel agencies selling flight tickets in the U.S.?

Lufthansa Group spokesperson Andreas Bartels doesn’t think so. “It’s not a contradiction,” Bartels says. “We will charge the DCC (Distribution Cost Charge) for all tickets booked via a GDS as we are charged from the GDSs ourselves. This means if CheapOair books via a GDS, the surcharge applies. It has nothing to do with the fact that CheapOair may sell advance seat reservations.”

Still, Lufthansa is committing additional resources into a travel agency channel that it hopes will find less traction in the future. Or another way of looking at it is that Lufthansa is being pragmatic and knows it will eventually settle its differences with the global distribution systems.

In an ironic twist, CheapOair gets the Lufthansa seat maps it uses to sell the airline’s advance seat reservations though the global distribution systems.