A retail travel agent who is not impartial in his selection of your airline flights, but who favors a particular airline because it pays him extra commissions, is known in the trade as a "dealership."
The dubious ethics involved when such dealership arrangements are kept hidden from trusting retail customers have, at last, been given a good airing in a public forum: the Managing Travel '88 convention for travel agents, held in Nashville, Tenn., in mid-June. Here's how the sides lined up:Ivan Schaeffer is president of Travel Trust International, a consortium of independent travel agents worldwide. He defends dealerships with a burst of cynicism: "It is sheer naivete to believe that (travel) agents are out there to do good things for America. The only thing that is more naive is believing that carriers are. People are in business to make money."
Schaeffer goes on to claim that retail customers of dealerships should be grateful for such arrangements with the airlines, on the grounds that they receive "services that otherwise wouldn't be possible." He is referring to a dirty little secret: The high-volume corporate customers of many dealership agents often receive quiet airline waivers of excursion-fare restrictions, such as minimum-stay provisions and cancellation penalties, as well as magical delivery of the lowest fares when they are "sold out" for the rest of the ticket-buying public.
Ron Santana, president of the Association of Retail Travel Agents (ARTA), provides a much-needed counterpoint to Schaeffer. The overriding question, says Santana, is whether today's de facto dealerships are in the public interest, and his response is a vigorous "no." Further, "If we allow carriers to discriminate, this will ultimately destroy the good parts of deregulation and we will get regulation again ... these are under-the-table deals. Consumers may be hurt if the deals are not known to the public."
Santana is dead right: The "little guy" winds up subsidizing special fare deals for the dealerships' corporate clients through his own higher fares. And it is very doubtful that the dealerships will give the same "little guy" those special corporate deals, either.
Several noted airline-industry experts, including Yale's Michael Levine (former president of New York Air), have called for a government policy compelling mandatory disclosure of special dealership relationships by travel agents who are parties to them. I agree totally. Too bad the other major travel-agent organization, the American Society of Travel Agents (ASTA), does not join ATA in condemning the discrimination caused by the undisclosed dealership system.