lufthansa a380
8 months ago
 

Lufthansa casts doubt on claims of fall after introduction of GDS surcharge

UPDATE:

A Lufthansa official says:

“These figures only represent the volume of bookings made though the GTMC channels and do not take account of increases in the bookings through other avenues. The fact is that we have sold more tickets online via our own online channel LH.com where the share has risen from 29% in June 2015 to 35% in December 2015.”

“Looking at bookings across the Lufthansa Group we cannot see any decrease due to the introduction of the DCC on September 1, 2015. As published in our Q3 results, the Lufthansa Group is heading towards a record in 2015. The published traffic figures for the later months of 2015 were influenced by the biggest and longest strike action in the Lufthansa history.

“Even taking this into account, we cannot see any switch away from Lufthansa.”

ORIGINAL:

Lufthansa has lost 8.5% market share due to its “flawed and failed strategy” to add a surcharge to bookings via Global Distribution Systems.

That’s the claim by the Guild of Travel Management Companies, after having compared data for the three months before and after the Euro 16 fee was added to fares on the carrier made through Travelport, Sabre and Amadeus.

The organisation says around 12,000 transactions were monitored at UK-based travel management companies to gauge if the introduction of the charge on September 1 last year had made any difference to the booking strategy of corporate travel agencies.

The GTMC says TMCs have switched business away from the airline group to avoid passing on the fee to travellers.

It also claims that Lufthansa’s market share was 32.9% in June this year, with it falling to 24.4% by November.

Beneficiaries have been other airlines, such as EasyJet, although British Airways was flat.

The GTMC does not mention that the Luthansa Airline Group had two significant periods of industrial action between September and November.

Lufthansa has previously claimed drops in traffic via GDSs were the fault of the series of strikes.

GTMC CEO Paul Wait says:

“We predicted that the Lufthansa charge would upset and put business travel bookers off. They haven’t booked directly with Lufthansa as they hoped, instead, they have voted with their feet and taken their business elsewhere.

“In this highly competitive market, we believe, this charge has done some obvious damage to Lufthansa’s market share.”

A highly confidential document circulating amongst the top brass at Sabre Travel Network, obtained by Tnooz from a third party in September last year, shared official booking volumes for all Global Distribution Systems and outlined how Lufthansa Group bookings in Europe in the first two weeks of September are said to be down 16.1% year-on-year versus a flat year-to-date up to August.

It also reported that on routes where Lufthansa has a market share of 30%-60%, volume drops of up to 30% were experienced in the first week of September. Competitor carriers British Airways, Air Berlin and Air France were said to gaining as a result from the declines.

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Kevin May

About the Writer :: Kevin May

Kevin is senior editor and a co-founder at Tnooz. He was previously editor of UK-based magazine Travolution and web editor of Media Week UK from 2003 to 2005.

He has worked in regional newspapers (Essex Enquirer) and started his career at the Police Gazette at New Scotland Yard in London. He has a degree in criminology, a postgraduate diploma in magazine journalism and publishes his first book - a biography about Depeche Mode - in late-2016.

 

Comments

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  1. Mike

    The reality in the travel agency community is who cares. It’s like a political web of nonsense. LH says they had strikes & business is just peachy. Most travel agents work on behalf of their clients and LH is more money with that change so it’s logical that is provided. Their business decline is showing for sImple math likely around the following simple reasons;
    1-LH is now more money than almost every other carrier.
    2-their own employees don’t seem to care much as they are higher ratio of employee strikes.
    3-they get good grades for keeping their heads in sand & saying what problems, huh, what

     
  2. chris dane

    There is no doubt that their direct channel is up as a result of this action….but….not up enough to offset the loss of GDS bookings. Does anyone really believe Lufthansa has not lost share, revenue and bookings as a result of this move that is totally unrelated to any strikes? Numerous stories have confirmed losses from GDS’s, agencies, corporate travel companies.. What Lufthansa never mention are the changes is their advance bookings….and there is a reason for that….they are down YOY! The only reason they are not down even more in North America is a result of their United Airlines joint venture which are not subject to the DCC.

     
  3. Timothy O'Neil-Dunne

    While I disagree with some of the conceptual part of this story – there needs to be a clear understanding of the context of the data. I dont think that the study is conclusive or statistically accurate. One therefore has to be very careful to understand the context of the conclusions that are being drawn here.

     
 
 

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