Back in October 2012, when Sabre and American Airlines renewed their distribution agreement and ended their dispute in the courts, mystery surrounded a “monetary payment” between the pair.
The case centred on the long-running saga (with claims and counter-claims) over American’s move to provide flight information directly to travel agents, rather than going through the global distribution systems, using its famed Direct-Connect model.
The happy ending (of sorts), after months of delays and a late switch in the presiding judge at Sabre’s request, may have turned out to be financially very rewarding for the carrier.
At the time, the “monetary payment” from Sabre to AA was undisclosed.
But perhaps the mystery is now unravelling a little, as the carrier’s recent financial report has a small summary item in it which may give a clue as to what happened back in that courtroom three months ago.
The fourth quarter 2012 earnings report for AMR Corporation, where it outlined record revenue of $24.9 billion the full-year (despite its Chapter 11 woes), also contained the following sentence:
“The fourth quarter results also include a $280 million benefit from settlement of a commercial dispute.”
What other commercial disputes to the tune of a quarter of a billion dollars could AA have settled in the last three months of 2012?
A Sabre official declined to comment when asked if there was any connection between the line in the earnings report and its settlement with the carrier in the fourth quarter of last year.
AA says:
“American is not able to disclose the identity or monetary payment associated with this particular commercial dispute.”
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About Kevin May
Investigative journalism – I like it. Sherlock Holmes would be proud…..
$250 mil is a lot of money, especially when you consider the ‘entire’ Airline industry is forecast to only earn $3-4bil profit (at 0.6% profit margin). http://econ.st/Sy3kLk