Nasty surprises in AA's addendum

Mark Pestronk

Q: At the end of April, American Airlines sent my agency a new 9,100-word document that is called, “American Airlines, Inc. Addendum to the Governing Travel Agency Agreements for ARC Accredited Agents and their affiliates.” This addendum is similar to one that American sent in 2016, but it is a lot longer. Does it have any surprises? Does it require our agency to offer NDC fares? We have not yet offered NDC fares because of the many extra steps involved in front, mid- and back-office work.

A: American’s new addendum contains a bunch of surprises — all bad — for all agencies that issue airline tickets. Corporate agencies, or TMCs, are especially targeted, but the new rules also affect leisure travel agencies.

The Beat, Travel Weekly’s sister publication, recently focused on one particularly negative rule: Agencies may no longer use automated reshopping software after booking on American. These long-standing tools work to find lower fares after ticketing but before travel, so that the agency can refund the higher-priced ticket and issue a new ticket at the lower price, thus saving the client money and possibly earning an additional fee for the agency.

The addendum also has these rather harsh new rules that show that American wants to force agencies to sell NDC content — despite an agency’s wishes, the additional costs involved and the loss of GDS incentives in most cases:

“Agent also shall not withhold access to American’s Content available via NDC unless the request is received directly from the customer.” “Content” is defined as all fares. So, if an agency wants to sell American tickets, it must now offer NDC content, except for the rather bizarre case where the client says it doesn’t want NDC fares.

“Agent also shall not impose service fees based on the method of distribution or the technology underlying American’s products or services that are higher than those imposed by Agent on the products and services of other air carriers …” In other words, you can’t charge higher fees for American’s NDC content than you do for any other airline’s content, no matter how much extra work you have to do.

“Any such service fees charged by Agent based on the method of distribution or the technology underlying American’s products or services cannot be disproportionate to the costs that Agent is trying to recoup for such method of distribution or technology.” This sentence appears to contradict the rule quoted above, but perhaps it means that your fees must not be disproportionate to costs. Whatever that means.

Finally, American has kept a rule that first appeared in 2016: 

“If Agent charges a customer a service or other fee for its services … the charge or fee for an American booking or other American product or service must be equal to the lowest fee imposed by Agent for other carriers.” So even with NDC fares, you can’t charge more for an American ticket than for any other carrier’s ticket.

American’s new addendum will undoubtedly cause many agencies to do less business with that carrier. 

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