After reading American Airlines’ response to ASTA’s complaint to the Department of Transportation, one thing is clear. In its attempt to defend its implementation of NDC technology, American Airlines only wants one thing - to do away with intermediated comparative shopping. In fact, American Airlines’ answer is only a thinly veiled attempt to suggest otherwise. It’s in their financial self-interest. But to assume that all customers prefer to buy direct through AA.com is arrogant at best. And claiming that consumers asked for NDC is like Apple claiming consumers asked that no wall charger be included with new iPhones. We may have to live with it, but we certainly didn’t ask for it.
ASTA believes in letting the customer have a choice in how they shop. Our shared customers want the ability to compare carriers, and flight options, on value, price and schedule.
ASTA does not dispute that significant changes to the merchandizing of air tickets are well underway. But that progress should not come at the expense of consumers or our travel agency members, who only want channel parity in fares and servicing capabilities, and the ability to fulfill the duty of care obligations corporate clients owe to their employees. By driving customers to its website and bypassing the agency distribution channel, American Airlines effectively denies both leisure and corporate travelers the value they derive from their trusted travel advisors in this increasingly complex travel world. Presupposing that all of our shared customers would prefer to purchase their air tickets directly versus through a trusted travel agency or TMC is, simply put, imperious.
American Airlines has accused ASTA of opposing the New Distribution Capability (NDC) when it claims it offers more options to consumers at lower prices and better service and is supported by other airlines and technology-forward travel agencies. What is ASTA's response to this?
American’s answer mischaracterizes ASTA’s position on NDC and technology generally. ASTA is not anti-NDC. We fully support the adoption of modern retailing methods when the necessary technologies are ready and in place. This requires collaboration between airlines, technology partners and agencies and we’re thankful for other airline partners who recognize that and have taken a more responsible approach, one that accounts for the viewpoints of both their customers and their travel agency partners.
AA has forced imposition of NDC on an air ticket distribution ecosystem that was and remains largely unprepared for it, in terms of the necessary supporting technology, training, and processes, among other things. American’s insistence on an unrealistic implementation timeline has caused serious harm to consumers, particularly those who choose to book through a travel agency or Travel Management Company (TMC).
Consumer Protection versus Agency Interests have been raised by American Airlines. Can ASTA clarify its response to the accusation that its complaint is about protecting certain travel agencies reluctant to adapt to new technologies like NDC?
The premise of the question – that the interests of consumers are in opposition to the interests of travel agencies and TMCs with respect to NDC – is simply false. Nor is it accurate to characterize agencies as reluctant to adapt to new technologies. Rather, it is about the ability of agencies and TMCs to provide the level of service the clients have come to expect and without forcing them to choose between obtaining the lowest fare or forsaking the duty of care. ASTA’s complaint to DOT was very clear in this regard, and American is using this claim to avoid taking responsibility for the very real duty of care problems these changes are causing.
Technological Advancements and Agency Readiness has also been raised in the complaint response. How does ASTA respond to the claim that NDC technology is better than the “outdated EDIFACT system” and requires travel agencies to invest in and adapt to new technologies, which some agencies are reportedly hesitant to do?
Framing the issue this way misses the point, as it’s not a question of the superiority of one technology over another. Again, it’s about readiness and AA’s egregious conduct in removing 40 percent of its fare inventory, possible only given its dominant market position, in order to place TMCs and other distribution intermediaries at a massive competitive disadvantage.
Can ASTA provide evidence of the impact of NDC on fare accessibility and transparency for travel agents, countering American Airlines' claim that all fares remain viewable and available for comparison in both EDIFACT and NDC?
“Viewable and available for comparison" is not the same as transactable, and AA unequivocally admits in its answer that it “does not allow all of its fares to be transactable using EDIFACT.” That quote is taken verbatim from the response AA filed with the Department of Transportation last month. And as for evidence of the resulting fare discrepancies, it is abundant. In late July and at ASTA’s request, a respected third-party fare data aggregator compared EDIFACT and NDC-channel fares for 142 different domestic city pairs flown by American. For each route, the aggregator also compared fares across different cabin classes (main cabin, main cabin extra, business and first class) where fares in both channels were published. Across the board, and without exception, the average NDC channel fare was lower, in some cases, by more than 50 percent. All of this, and more, is detailed in ASTA’s complaint.
What other changes can ASTA provide examples of showing how the changes in American Airlines distribution model impacts travel agents and the clients they serve?
Beyond the egregious price disparities which gouge consumers who prefer to book through the agency channel, AA’s actions have had other serious negative effects including, but not limited to, the ability to efficiently comparison shop, service bookings, exchange tickets, and book certain itineraries. But even more concerning is the interference with the duty of care obligations businesses owe to their employees when they travel on behalf of their employer. These non-economic impacts are addressed in detail in ASTA’s filed complaint.
American Airlines claims Travel Management Companies’ (TMCs), are prepared or getting ready for NDC, what is ASTA’s view on this? What other changes can ASTA provide examples of showing how the changes in American Airlines distribution model impacts travel agents and the clients they serve differently to the average consumer?
In their DOT filing, AA intimates that NDC already includes robust functionality. This readiness is overstated.
While the items listed in AA’s response regarding functionality are accurate, it’s also very limited in terms of functionality and only available as individual components and for new NDC reservations only. What’s lacking from AA’s response is how atrocious the workflow is for new reservations. We know that’s not how corporate managed travel works.
We disagree with AA’s assertion that agencies are grasping onto the old ways of managing travel. Most travel agencies and TMCs lack the deep pockets of an airline or a major OTA player to invest in proprietary solutions. We rely on 3rd party companies to enable our business. AA has been working on their solution for 10 years and offered less than 12 months for TMCs to catch up. The GDS will affirm they have been developing in parallel to AA as it released updates to its API. While the functionality continues to improve, we are all a long way from complete.
How does ASTA respond to American’s claims NDC improves service and efficiency for travelers?
As noted above, and described in substantial detail in the complaint, NDC in its current state of development impairs, rather than improves, service and efficiency for the nearly 50 percent of all travelers who elect to book air tickets through a travel agency or TMC.
How do you propose that American Airlines resolve this complaint, and what would the next step for ASTA be?
Beginning nearly a year ago, ASTA foresaw serious difficulties and began voicing legitimate concerns about the feasibility of an April 2023 NDC implementation launch on a largely unready industry. Soon thereafter we proposed, quite reasonably in our view, that American delay implementation of NDC until such time as a fuller state of readiness could be achieved. Those pleas fell on deaf ears, necessitating ASTA’s formal petition to the DOT. As such, the matter will ultimately be decided by the DOT, and following submission of our reply brief, we look forward to a swift and fair adjudication of ASTA’s claims on the merits.