Consumers Victims of Airline Commission Cuts, Says AAA

    WASHINGTON--June 12, 2002--Consumers are paying more for travel and losing valuable access to travel agent expertise and service as a result of the recent elimination of airline commissions, according to AAA, the nation's largest leisure travel agency.
    In testimony before the National Commission to Ensure Consumer Information and Choice in the Airline Industry, Mark Brown, AAA executive vice president, stated today that airline commission cuts to travel agents will continue to have a direct negative impact on consumers.
    "Commission cuts have more than a ripple effect on consumers; it's more like they've been hurled about without warning into a rip tide," said Brown of AAA. "They lose three ways - cost, expertise and service - and there are few who can negotiate safe ground on their own."
    Brown told the nine members of the commission established by Congress that the recent move by airlines to eliminate commissions paid to travel agents for selling airline tickets has forced many agencies to impose a service charge on customers in order to sell airline tickets. As a result, Brown pointed out, airline ticket prices have increased.
    "When commissions were eliminated, airlines did not lower the cost of the ticket long term across the board, so the consumer pays twice - once for the ticket, which still includes a margin no longer paid out as commission, and again for ticket processing," said Brown.
    He emphasized that travel agents provide valuable information and advice to travelers that most travelers are unaware of. Availability, penalties for scheduling or itinerary changes, rules and regulations, fare differentiation and international considerations - all behind-the-scene details most consumers have little or no information about.
    "Without an agent's assistance on all but the simplest of routings, consumers are at a distinct, and possibly costly, disadvantage," said Brown.
    He characterized the effects of the airline's zero-commission policy as victimizing consumers through a loss of service.
    "Most of us rely on the agent who sold us the ticket to help us with unexpected delays, changes in plans, and compensation for problems not under our control," he said. "Who does the consumer turn to when there is no travel agent standing behind them because it's no longer profitable for the agent to sell an airline ticket?"
    Brown offered recommendations that AAA says would continue to support travel agents as the independent source of comparative price and service information for consumers. These recommendations include:

--	Equal access to airline inventory and pricing, regardless of distribution channel, since 46% of the U.S. population does not use the internet;
--	A Ticket Processing Fee (TPC) included on standard traffic documents to more fully explain ticket costs, which requires unanimous consent of all International Air Travel Association (IATA) members; and
--	Continued vigilance in investigating airline distribution practices by the Department of Transportation to protect consumers.

    "Through our travel agencies we help customers make travel arrangements to fit their schedules and special needs, and look out for them when things go wrong," Brown said. "It can also be something as essential as getting them home safely when things unravel during a disaster situation such as this country experienced last September."
    As North America's largest motoring and leisure travel organization, AAA provides its 45 million members with travel, insurance, financial and automotive-related services. Since its founding in 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for the safety and security of all travelers.