CWT: Fundamental Issues with Lufthansa’s Direct Connect Approach
25 NOVEMBER, 2015
In September 2015, Lufthansa implemented an additional fee for distribution through the GDSs, which is applied directly to tickets at the point of sale.
On 4 November, the Lufthansa Group (Austrian Airlines, Brussels Airlines, Lufthansa and SWISS) announced its plans to enable direct connect solutions with various industry partners as well as new “exclusive offers” outside of the GDS.
Statement from Carlson Wagonlit Travel (CWT), attributable to Scott Brennan, executive vice president and head of Global Supplier Management:
Despite concerns raised directly to Lufthansa by CWT and many others in the industry, Lufthansa has continued to make significant changes to the booking process offered to clients and travelers with the addition of a €16 fee for each GDS booking.
As a TMC, one of CWT’s key roles is to help ensure our clients have access to complete and competitive travel options. CWT believes the fundamental issues with Lufthansa’s direct connect approach are:
Fragmentation of content that creates complex, manual searching and booking
Less comprehensive comparison shopping resulting in reduced visibility of competitive fares
Limitations for TMCs to communicate directly with travelers or to assist with travel changes or during emergencies
Fragmented data for reporting and traveler tracking
Additional cost – even if Lufthansa’s €16 fee is avoided – to bring bookings made directly with Lufthansa back into the managed program and to manage inefficiencies and complexities related to changes, exchanges, refunds, invoicing and reporting
CWT believes no viable solution exists to avoid the €16 distribution fee without resulting in increased cost to maintain existing services and value for our clients. Given this, CWT continues to believe GDSs present the most efficient, complete and cost-effective distribution solution currently available for the corporate travel industry.
CWT is a global leader specialized in managing business travel and meetings and events. CWT serves companies, government institutions and non-governmental organizations of all sizes in more than 150 countries and territories. By leveraging both the expertise of its people and leading-edge technology, CWT helps clients derive the greatest value from their travel program in terms of savings, service, security and sustainability. For more information about CWT, please visit our global website at www.carlsonwagonlit.com. Follow us on Twitter @CarlsonWagonlit.