BERLIN, May 26 (Reuters) - IAG-owned airlines British Airways and Iberia are to follow Lufthansa by charging a fee for bookings via third parties, using new technology to take more control of their own bookings.
The move will be a blow to global distribution systems (GDS) providers such as Amadeus IT Group, Travelport and Sabre, the share prices of which all fell on Friday. Amadeus was down 4.5 percent, Travelport dropped 3.1 percent and Sabre lost 1.6 percent.
Lufthansa caused a stir in the industry when it introduced its own GDS surcharge in 2015 and CEO Carsten Spohr has repeatedly said he expects rival carriers to follow suit.
“From what we hear in the industry, and with the visible success of Lufthansa, I’d be very surprised if others would not follow,” he said in March.
Airlines often have a tense relationship with GDS providers, which typically achieve much higher profit margins than the airlines themselves.
British Airways and Iberia said that, from Nov. 1, fees of 8 pounds or 9.50 euros ($10.63) will be levied on bookings not made via the airlines’ own websites or direct sales channels.
“We will continue to work with the GDS providers to distribute our content to valued agency partners via existing solutions. However, these systems and their traditional technology solutions currently carry significantly greater costs to BA and IB,” the airlines said in a statement.
Previous attempts to break away from the system cost airlines market share, prompting a return to the GDS providers, but new technology means airlines can now offer corporate customers similar booking tools themselves.
Siemens is one corporate customer that has signed up to Lufthansa’s system rather than using third parties.
IAG Chief Executive Willie Walsh said this month that talks with Amadeus were ongoing, adding that the existing relationship between airlines and GDS providers was unsustainable.
“We’re prepared to take some short-term pain to get some long-term structural change in that relationship,” he said after the group reported first-quarter results. ($1 = 0.7819 pounds) ($1 = 0.8941 euros)
Reporting by Victoria Bryan; Editing by David Goodman
Our Standards: The Thomson Reuters Trust Principles.