Travel Agency Group Doubles Down on Dispute With American Airlines

The American Society of Travel Advisors (ASTA) and American Airlines are going head-to-head in a complaint before the U.S. Department of Transport (DOT). Skift reached out to ASTA for the group’s latest position following a response from American Airlines last month.

The debate hinges on whether the airline has been wrong to withhold a big chunk of ticket options from travel agencies that fail to adopt its preferred booking technology.

Here’s a quick recap on the latest twist in a decade-long saga about how agencies process tickets.

• Travel agents have used reservation desktop software based on the Edifact (the United Nations rules for Electronic Data Interchange for Administration, Commerce and Transport) programming language for decades.

• American Airlines believes the industry needs modern technology for distribution. A decade ago, it led a multi-airline effort to push travel agents to adopt new technology, known by the shorthand new distribution capability, or NDC.

• American Airlines has used carrots and sticks to get agents to adopt NDC. Earlier this year, it pulled about 40% of its fare inventory out of the old system.

• The largest travel management companies (TMCs) and online travel agencies have had the resources to adopt the new tech.

• However, many smaller travel agencies say the cost and training effort to learn the new workflows is overwhelming. They want a more gradual roll-out.

• Many of American’s cheapest fares are now only purchasable through NDC channels. That places smaller travel agencies at “a massive competitive disadvantage” to American’s direct booking website and the better capitalized online travel agencies, ASTA said.

• Small-to-midsized agencies say they need time to cope with the changes in how ticketing inventory is displayed and controlled. Today, they can’t efficiently service bookings (such as changing or canceling reservations), exchanging tickets, or booking certain itineraries).
  
• Duty of care is a legal requirement for employers to know the whereabouts of their employees and any potential risks involved in employee travel. Edifact systems support this, while NDC technologies do not, hindering TMCs from doing their work, says ASTA.

• In August, agency group ASTA filed its DOT complaint that American Airlines is essentially using its market dominance to bully them by limiting them from offering customers a broad comparison of flight options and prices.

• ASTA said NDC, in its current state of development, impairs service and efficiency for the nearly 50% of all travelers who book air tickets through a travel agency or TMC.

• American Airlines responded to the DOT complaint in November, accusing the association of stifling innovation.

Skift asked ASTA to reply to how American Airlines defended itself to regulators last month. ASTA did on Monday, exclusively, below. The response has been edited for brevity.

What proof do you have you’re losing access to the lowest fares?

In late July and at ASTA’s request, a respected third-party fare data aggregator compared Edifact and NDC-channel fares for 142 different domestic city pairs flown by American.  

For each route, the aggregator also compared fares across different cabin classes (main cabin, main cabin extra, business, and first-class), where fares in both channels were published. Across the board, and without exception, the average NDC channel fare was lower, in some cases, by more than 50%.

What is ASTA’s perspective on American Airlines’ claim that travel agents don’t want to change with the times?

In their DOT filing, AA intimates that NDC already includes robust functionality. This readiness is overstated.  

While the items listed in AA’s response regarding functionality are accurate, its [workflow] is also very limited in terms of functionality and only available as individual components and for new NDC reservations only.

What’s lacking from AA’s response is how atrocious the workflow is for new reservations.

We disagree with AA’s assertion that agencies are grasping onto the old ways of managing travel. Most travel agencies and TMCs lack the deep pockets of an airline or a major online travel agency to invest in proprietary solutions. We rely on third-party companies to enable our business.

How do you respond to American Airlines’ claim that ASTA’s complaint favors agencies over consumers?

The premise of the question — that the interests of consumers are in opposition to the interests of travel agencies and TMCs with respect to NDC — is simply false.

Nor is it accurate to characterize agencies as reluctant to adapt to new technologies.

Rather, it is about the ability of agencies and TMCs to provide the level of service the clients have come to expect without forcing them to choose between obtaining the lowest fare or forsaking … the duty of care obligations businesses owe to their employees when they travel on behalf of their employer.

American is using this claim to avoid taking responsibility for the very real duty of care problems [Outlined in page 34 of the complaint PDF] these changes are causing.  

How does ASTA counter the claim that travel agencies are reluctant to invest in new technologies, holding back the sector? 

Framing the issue this way misses the point, as it’s not a question of the superiority of one technology over another. Again, it’s about readiness.   

How does ASTA respond to American Airlines’ accusation that it opposes NDC, which is said to offer more options, lower prices, and is supported by other airlines and technology-forward agencies?

American’s answer mischaracterizes ASTA’s position on NDC and technology generally.

ASTA is not anti-NDC. We fully support the adoption of modern retailing methods when the necessary technologies are ready and in place. This requires collaboration between airlines, technology partners, and agencies.

We’re thankful for other airline partners who recognize that and have taken a more responsible approach.   

American Airlines claims to have comparable fare visibility in both the old and new workflows.

“Viewable and available for comparison” is not the same as transactable, and AA unequivocally admits in its answer [filed with the DOT] that it “does not allow all of its fares to be transactable using Edifact.”

AA has been working on its solution for 10 years and offered less than 12 months for TMCs to catch up. While the functionality continues to improve, we are all a long way from complete.  

The matter will ultimately be decided by the DOT.