Saturday, August 30, 2014

American Airlines and US Air Leaving Orbitz


American Airlines and US Airways have withdrawn all their ticket sales from the travel website Orbitz due to being unable to come to an agreement on a new contract.  

Travel websites have since over taken the roll of ticket purchases from the airlines actual website by offering "lower prices" or specials but now the tides are changing.  Many airlines are wanting to regain control again of purchase sales and so the public will be seeing less from companies like Orbtiz and Expedia and more directly from the airlines as they revaluate the cost and benefits of working with the companies. 

To say that this loss to Orbitz is great is an understandment, it is huge.  American and US Airways together account for a quarter of the U.S. travel market and it has already reflected in the stock market.  Shares in Orbitz Worldwide fell 4.6% on Tuesday closing at $8.04.

An example of an airline that already "controls cost" by not selling their tickets through travel companies is Southwest Airlines.  They have always sold directly through themselves and it is has proved to be a successful method of climbing to the top of the airline ladder by keeping money "in house."

Even with this change, tickets that have already been purchased are still valid but in order to make changes to the reservations you now have to call the airline directly. 

 Also, Orbitz put out a statement letting the public know "Our sites offer hundreds of airlines which are eager to capture the revenue American is choosing to forego, and we will continue to show our customers a broad range of flight options to thousands of destinations in the U.S. and worldwide."

*source: Chicago Tribune*

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