A mess called TAAI and TAFI

Clarifications sought from TAAI / TAFI President
(Sum's take on Transaction Fee issue and issue confronting small and medium TAs, clarification for which is sought from Industry Assocations)

1. The validity of the transaction fee model.

Since the validity of the agreement signed with most of airlines is Dec 2009, what is the stand of the airlines and TAAI on extension of the agreement and transaction fee to be charged? An agreement on which the revenue of an agency depends cannot be a knee jerk agreement of short period (1year) with lack of clarity about its validity in the long run. TA's will not be able to transform and build a business model around this agreement in light of lack of clarification as to its validity in the long run (3-5 years).

2.The termination clause of the present agreement

What is the minimum notice airline are expected to give to TA's for any changes they wish to make in the present agreement including termination/ change in method of charging OC or change in the rate of Transaction Fee.

3. Notice of reduction of commission by the airlnines

Why did TAAI agree on a notice of 60 days by the airlines for reduction of commission and introduction of transaction fee, while some of the members have signed contracts with the clients offering discounts on a yearly basis?

4. Rationale behind TAAI Convention at London

What are the successes of TAAI convention held in London and what was the rationale behind holding a convention of such large scale overseas and spending huge sum of money, whereas the industry was amidst a crisis of erosion of its revenue base. Why was the convention not held in India and support of the members mobilized on a much higher scale to carry and conduct protests on the commission issue


5. Negotiation with the airlines

Who were the members who were a part of the negotiating team of TAAI while negotiating with the airlines and what was the size/ nature of their business. Why was there no referendum on the issue of acceptance of transaction fee and why was there no representation of small/ medium travel agents in the negotiation process?

6. Same transaction fee for different RBDs

Why did TAAI not negotiate a model with the airlines, where airlines could come up with private fares with no commission on lower levels of fares/ RBD's, but offer commission on all higher level of fares including economy, business and first class (The airline can offer private fare on its lowest fare levels and offer commission for higher fare levels thereby not discouraging an agent who is selling higher level of fares). With the implementation of same transaction fee for all levels of economy class, airlines are actually discouraging agents who sell higher RBD's.

7.Why is there a sudden change in the stand of TAAI from anti TF to pro TF.
8. Efforts by different associations

Why has there been no coordinated effort by TAAI/ TAFI to jointly take up the issues with the airlines and come on a common platform to discuss issues with the agents at the bottom of the pyramid and help them reform their business models.

9. Call for bycott

Why has there been no call of nation wide boycott of all airlines, who are not accepting TAAI stand on TF on the ticket

10. Demand / Supply Rationale

While with the levy of TF there has been an increase of 15-20 % in airfares with little no change in demand (as per what most of the airline heads are quoting). Does it not make more sense to increase all the airfares by 5-7 % (instead of 15-20 % in case of TF) and retain the same level of commission? The airline yield will increase by 5-7 % and this will offset their cost on account of 5% agency commission. Again here some fare levels can be sold, as private fares with no commission to TA's and TA's will be free to charge transaction fee.