1 / 22

Airline Ancillary Fees

Airline Ancillary Fees. Ellen Trotochaud Sr. Director, Analytics and Vendor Relations Concur September 9, 2010. Agenda. Ancillary Fees – Status Quo. Solutions Discussed. Your Role. Q&A. Ancillary Fees Include. The Cost - $7.8B collected in 2009 alone and rising.

talen
Download Presentation

Airline Ancillary Fees

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Airline Ancillary Fees Ellen Trotochaud Sr. Director, Analytics and Vendor Relations ConcurSeptember 9, 2010

  2. Agenda Ancillary Fees – Status Quo Solutions Discussed Your Role Q&A

  3. Ancillary Fees Include

  4. The Cost - $7.8B collected in 2009 alone and rising • Prices change frequently • Airlines have different products • E.g. Spirit recently announced fees to use onboard overhead bin space • British Air charges for advance seat assignment • Corporations are trying to understand the impact of these fees • Some studies show that ancillary fees represents only 1% of air costs*, some up to 30%** • Latest Concur study shows the cost at 2.3% of air cost • Many fees are waived for elite flyers • What is considered an ancillary fee? • Are ticket related fees, e.g., change fees, even considered ancillary? * TRX (as reported in The Beat) **NBTA 2010 U.S. Business Travel Buyers' Cost Forecast. • It is difficult to quantify the cost of ancillary fees:

  5. Airlines have unbundled services – Pay for what you use

  6. Bundled Fee Packages - Now airlines are bundling fees • Not all bundled fee packages included the same ancillary charges: • This creates added layers of difficulty for managing policy • Example: United offers several packages today but some include club passes which are typically not allowed in a travel policy. But how would a corporate travel manager know? • Each airlines bundled packages include different fees • Would you like to value size that?

  7. Ancillary Fees – What is the impact on your program? Source: Deloitte

  8. Everyone is working towards a solution – but not together! Developing EMDs (3Q10) GDS’s are working on building merchandizing platforms Has introduced standardized codes for ancillary fees Has set a deadline to standardize fees in 2012

  9. Industry Proposed Solution and Alternatives Two Parallel Paths: PoS and Credit Card Reporting

  10. Considerations Will the Government step in?

  11. Data on Fees Provided to Card Companies - CO

  12. Data on Fees Provided to Card Companies - UA

  13. Data on Fees Provided to Card Companies - AA ?

  14. Concur’s Solution for Reporting of Ancillary Fees • Concur identifies a charge coming from an airline based on merchant code or employee entry if not using a card feed • If a charge is under a company-defined amount, the expense type is automatically entered into the expense report as “other airline fee” • The employee is prompted to choose one of six sub-fee expense types: Baggage, Upgrades, Seats, Airline Club, On Board, Other • Policy audit rules can be associated with each of the fee types • Fee reporting available

  15. Party of Three – Silver Bullet

  16. Critical Components for a Solution • Standardization across the industry • Airlines sending the data in a standard format differentiating for all types of fees • The data needs to be the same regardless of point of purchase • Ancillary fees need to match to the original ticket • Transparency of services required throughout the buying cycle • Point of Sale support of fees are more complex and may take longer to evolve • Focus on corporate card solution can be a quick resolution

  17. What are your thoughts?

  18. What are your thoughts?

  19. Voice Your Opinion

  20. Things to Keep In Mind

  21. Questions

More Related