By Martin Kelly, Editor, Travel Trends
Smart or dumb? Opinion is split on Singapore Airlines’ (SQ) decision to abandon Flight Centre, Australia’s largest travel agency group, as a distribution channel. Flight Centre, which has more than 600 local outlets, put a “stop sell” on SQ after the airline reportedly refused to pay overrides of up to 3% on its base 5% commission.
It’s a massive move by SQ, believed to derive 15% to 20% of its local revenue from Flight Centre, at a time when other big carriers are boosting agency commissions. SQ is talking tough, saying its customers are loyal and will instead book through its website or other travel agencies. Smart or dumb?
I’m leaning toward the second option.