Airlines-travel agents 'must avoid competition'
Manama, June 28, 2011
Competition between airlines and travel agencies should be discouraged to save travel companies from a potential complete loss of business, a leading travel company has said.
In a meeting between the Association of Bahrain Travel and Tour Agents (ABTTA) and Gulf Air, the associaation chairman Sofyan Al Moayyed brought up the issue of the airline's discounted price offer to the government sector and how it would be detrimental to Bahrain's travel agents if it were to continue.
"ABTTA has always had a good relationship with Gulf Air but we were very shocked at its incentive to sell airline tickets at a 20 per cent discount to the government," said Al Moayyed.
"We encourage healthy competition between airlines as long as they are equal but what we discourage is direct competition with us travel agencies."
"We have no problem with the discount, as every airline offers such discounted prices but our question is why cannot it involve us, why can't government employees come through us to get the discounted flights?," he added.
When travel and tour agents deal with airlines, money made from airline ticket sales must be transferred within 14 days and if no payment is received, the travel agent's system automatically locks down, said Al Moayyed.
"By dealing directly with government employees, this money could take 90 to 120 days to come through whereas if we were involved in the incentive then this 14-day turnover would guarantee that Gulf Air gets its money quickly."
"Essentially a huge chunk of this industry is being sidelined by this move, and Gulf Air will be subsidising for the next four months, which to a businessman doesn't make any sense," he remarked.
Al Moayyed voiced these concerns to Gulf Air chief commercial officer Karim Makhlouf and chief executive officer Samer Al Majali on Sunday.
The concerns were originally announced at a meeting between ABTTA members and government officials last Wednesday.
"We don't see eye-to-eye with Gulf Air on this issue but this meeting was the first step to try to reach an agreement and we will continue to meet the airline officials to discuss it further," he stated.
"There are 262 travel companies in Bahrain and if this situation continues, it could have serious consequences as travel agents could be forced to close their doors to business."
"The government should be very happy with this discount, Gulf Air will be very happy now perhaps they can make us travel agents happy as well," he added.-TradeArabia News Service