WESTERN BUREAU:
BWIA SAYS it will slash by a third today, its commission to travel agents.
This has triggered unease among industry operators who fear the move could have serious repercussions.
Most airlines had reduced their commission to agents by 33 1/3 per cent in the year 2000, but BWIA which has its headquarters in Port-of-Spain, Trinidad and Tobago, has just decided to go that route. The reduction facing the agents means their commission has dropped from 9 per cent to 6 per cent.
Janice Collins, president of the Jamaica Association of Travel Agents (JATA), says that while the group understands the move by BWIA, "it means substantial loss in revenue for many local travel agents who have recently increased their promotion of intra-regional travel."
"In addition, the general poor state of the economy is taking its toll on members of my profession, and there have been a number of closures and mergers of travel agencies, over the last two years. We expect the trend to continue."
She added that since last year, six or seven agencies are no longer in existence due to closures, or a move to amalgamate with other entities.
One major merger in the industry last year was that of a veteran in the business, Martin's Travel Service Ltd., with Trafalgar Travel Ltd. However, consumers should see no increase in the price of airline tickets or service charges by the agents as a result of the reduction in commission.
Checks by The Gleaner this week reveal that most travel agents impose a service charge of between $500 (US$10.40) and $720 (US$15) for each transaction. This service charge started two years ago by the agents, to offset the reduction in their commission by most airlines. The service charge applied also to transactions involving BWIA routes, even though BWIA had not rolled back its commission. So today's slashing of commission by BWIA will not result in a hike in the service charge for persons seeking to travel in the region.
Expressing concern over the state of the travel industry, Mrs. Collins said that while there were serious efforts by agencies to avoid staff-cuts, there was a high attrition rate in the business since many persons were having a hard time making ends meet.
As the agencies grapple with the hard times, membership in JATA has fallen from 47 in 2000 to 35 this year.
Ann Saunders, an executive member of JATA, has urged the Government not to increase taxes on airline tickets as this would kill the already stressed travel industry, especially in light of the slump in the travel industry since September 11.
