Tuesday, 14 December 2021 03:45

TAANZ: Agents 'let down' by NZ

Brent Thomas Brent Thomas

The Travel Agents' Association of New Zealand (TAANZ) says agents will feel let down by the national carrier's announcement that it is reducing front end commissions next year.

The airline advised brand heads and TAANZ yesterday that from 1 July 2022 it is adjusting current New Zealand point of sale commission levels from 5% to 1% for long haul routes and 3% to 0% for short haul routes.

TAANZ president Brent Thomas says agents have supported Air New Zealand for the past difficult 22 months with 'bookings, credits, rebookings, and more credits' with little to no value (for the agent). 'We have been working in a low income environment and this is happening just as we are coming out the other side.'

Leanne Geraghty, Air New Zealand's chief customer and sales officer says that the brands have expressed disappointment – a reaction that was expected. 'I understand where they are coming from, but the distribution strategy and the way we want the channel to play out is not changing. We continue to work closely alongside the trade and obviously we have commercial arrangements with the brands.'

In a letter to the industry, Air New Zealand noted that adjusting commission on international fares is not a decision that was made lightly. 'However, having a competitive cost base is critical to our long-term success and is an important step in our recovery plan. Not bringing this change in until next year gives the industry an adjustment period.

'Agents add tremendous value for many customers given their expertise and specialist knowledge of destinations far and wide, We will continue to provide front line support for travel agents through our agency sales team and account managers, commercial agreements and funding for joint marketing and promotion activity.'

Thomas says that with no reward to do a short haul booking 'at the front end' there is likely to be significant impact on independent agents and brokers in particular.