Travel Managers Express Confusion on Changes to Airfare Distribution

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Travel Managers Express Confusion on Changes to Airfare Distribution

It’s no secret that the air distribution channel is changing, but the benefits of these upgrades aren’t always clear.

ACTE Global and American Express Global Business Travel set out to research the challenges to transforming distribution, and their Evolution of Air Distribution study found that there is a lot of confusion and uncertainty among travel managers about these changes.

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Research revealed that just 19 percent of travel managers are fully confident in their understanding of NDC, and nine out of 10 travel managers are concerned that NDC will increase costs, reduce fare and data transparency and negatively impact policy compliance.

Travel managers do expect some benefit from NDC, which is designed to address changes in air travel costs. Sixty-four percent said that NDC could improve the booking experience and 56 percent believe it could help contract negotiations with airlines.

However, the majority of travel managers fear that fragmentation created by NDC could threaten cost control (89 percent), policy compliance (87 percent) and duty of care (77 percent).

“Airlines have had to contend with proliferating traveler demands for decades, ranging from a preference for low fares to the desire for constant connectivity while in the air,” said Greeley Koch, executive director, ACTE Global. “NDC is a response to these market forces and could make for better traveler experiences through personalization. But it has come at a cost to travel managers, who are now scrambling to figure out how to maintain control of their programs if NDC becomes the norm.”

Airline ancillary purchasing is already a concern. Almost half of travel managers (49 percent) say that travelers buy out-of-policy ancillaries from airline websites “some of the time.” This unbundling prevents travel managers from seeing exactly what is spent on air travel.

“Travel managers need comprehensive access to air content in a scalable, transparent and cost-effective way, to properly serve travelers’ needs and businesses’ purposes,” added Mike Qualantone, executive vice president of Global Supplier Relations for American Express GBT. “We fully embrace NDC as a positive sign that airlines want to standardize distribution. However, our primary responsibility is to our clients and their travelers, and we have questions and concerns on how airlines will use NDC as opposed to its potential and promise. NDC alone is not a silver bullet. As an industry, we must find more ways to deliver full content access and an improved experience while maintaining service, comparability and functionality.”