Travelport has been advised by Flight Centre that its GDS contract for Australia and New Zealand will not be renewed when it expires on June 30, 2017, according to informed sources.
Flight Centre’s decision leaves Sabre and and Amadeus to fight it out for Asia-Pacific’s biggest retail account, which is estimated to generate more than $100m in revenue each year.
It’s the end of an era for Travelport and will surely lead to a long-term restructuring of its Australasian business, which has revolved around Flight Centre for more than 25 years.
In that time Flight Centre has evolved into a global retail juggernaut with almost 3000 ‘businesses’ in Australasia, North America, South Africa, Europe, Asia and the Middle East.
At one point Travelport had all this business but there have been rumblings for the past few years that Flight Centre has been looking for change.
The talk proved true when last year Amadeus took over the European business while Sabre now services Flight Centre in Canada, United States and Mexico.
This has enabled Flight Centre to road test all three of the Global Distribution Systems, leading to its recent decision to move on from Travelport in the Australasian market.
Industry speculation is that Travelport was processing 23m to 24m airfare segments from Flight Centre before the Europe and North American switch.
That’s now down to around 15m and will plummet when the current agreement expires next June.
It’s understood Travelport staff were recently informed of Flight Centre’s decision.
However the company declined to comment beyond the following statement issued today:
“Last July we announced a new multi-year agreement with Australia-based Flight Centre Travel Group as one of their global distribution system providers.
“Due to the confidential nature of this agreement, we are unable to comment any further.”
Flight Centre also cited confidentiality when issuing a no comment late this morning.