July 22, 2024

Adventure Destinations League

Navigating Travel Wonders

Hawaiian Airlines says fee-disclosure rule will harm agency distribution: Travel Weekly

Hawaiian Airlines would need to halt all traditional GDS sales if the U.S. Department of Transportation implements its rule for airline fee disclosure as planned on Oct. 30, the airline stated in a recent court filing. 

The declaration, however, contemplated a worst-case scenario in case Hawaiian can’t comply with the DOT regulation. 

“We strive every day to enable our travel agency partners to sell our products as effectively and transparently as possible and will continue to do so,” the airline said in a statement. 

The disclosure rule requires airlines and ticket agents to tell consumers upfront what fees they charge for a first or second checked bag, a carry-on bag and for canceling or changing a reservation. Airlines must provide the data to travel agencies beginning Oct. 30 and to consumers in direct channels by April 30. 

Trade group Airlines for America (and members Hawaiian, Alaska, American, Delta, JetBlue and United) filed suit against the DOT in May over the rule. IATA and the National Air Carrier Association, which represents discount U.S. carriers, are also litigants in the case. The plaintiffs are asking the Fifth Circuit Court of Appeals in New Orleans to vacate the rule, which they say is arbitrary and exceeds the DOT’s authority.

Airlines are also arguing that the rules will clutter search display screens, confusing consumers.

In a series of pleadings submitted to the court on June 14, airlines argued that the technological constraints of the Edifact technology used to power legacy GDS systems will make it expensive or impractical to comply with the DOT’s deadlines. 

Meanwhile, integrations to NDC-supported distribution are costly, time-consuming and require cooperation from technology partners and travel agencies. 

Kristina Larson, Hawaiian Airlines’ managing director of distribution, offered an especially stark analysis of the impact the rule would have. Legacy GDS technology, Larson said, is not capable of presenting passenger-specific data, as required under the DOT rule. Such data includes the passenger’s loyalty status, military status and status they have as the holder of a particular airline credit card. 

If the rule’s effective date is not stayed, said Larson, then Hawaiian must plan to “disable the legacy Edifact distribution standard on Oct. 30 to prevent distributing inaccurate, non-passenger-specific content to third-party distribution providers who are unable to migrate to the NDC standard. This will result in a revenue loss of millions of dollars per month, as consumers will no longer be able to book travel through those channels.”

She also said that Hawaiian would have to immediately begin incurring costs to negotiate new contracts and to initiate the technology upgrades required for travel agencies and aggregators to share passenger-specific information via New Distribution Capability (NDC). 

The DOT has already denied a request by airlines to stay implementation of the rule, arguing that a delay would harm consumers. The rule, says the DOT, will protect consumers by allowing them to make more informed, and quicker, determinations of the full price when shopping for airfare. 

No travel agencies have joined the Airlines for America suit. But the rule has drawn ire from ASTA, which represents travel agencies, and the Travel Technology Association, which represents GDSs and online travel agencies.

The rule requires agencies and airlines to provide the upfront fee displays, but it doesn’t require airlines to provide that information to agencies through legacy GDSs. Instead, airlines can choose how they provide the information.

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