Friendly Skies;
Hanna Turner felt that travel agents were taking her company for a ride -- a needlessly costly one. "We had always been assured we would get the lowest fare," says Turner, travel co-ordinator for Aura Ltd., of Lincolnshire, Ill. "Once we looked into it, we found we didn't get the lowest fares."
Turner had discovered the travel industry's darker side: deregulation has led to incentives that tempt some agents to favor certain airlines. Agents typically receive a 10% commission on domestic ticket prices, but overrides can raise that to 14% or higher. And computer reservation systems offered by major airlines can favor the providers themselves. Exact numbers are lacking, but there may have been significant overcharges in the $33 billion in airline tickets written by travel agents in 1985.
To cut travel costs, Turner looked to yet another product of deregulation, the new discount travel agencies. McTravel, of Northbrook, Ill., passes along its commission on airfares as a discount to travelers. It charges a flat fee for reservations ($8), ticketing ($7), or other services, with a $10 minimum charge per order. More such discount agencies are popping up, including Cashback Inc., in Denver, which discounts vacation packages. "I'm very satisfied now, because I feel I have control," says Turner, who expects big savings in her travel budget.
Discount agents aren't right for every trip. If a traveler is apt to change reservations frequently, the savings may evaporate. And the bare-bones agencies can't offer extensive service. Concedes McTravel's Richard Dickieson, "If you were going to the Orient and were going to plan eight stops, and you needed someone to plan the whole itinerary for you, that's something we're not equipped to do."
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