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ASITA Calls on Garuda to Maintain 7% Commission Level

Travel Agents Reassess as Garuda Slowly But Surely Move Towards Non-Commissionable Airline Tickets.

(5/9/2009) Indonesian travel agents from the Association of Indonesian Travel Agents (ASITA) are calling on Garuda Indonesia to preserve the 7% commission they earn on airline ticket sales.

Mangara Goeltom, representing ASITA, complained that recent changes by Garuda that allow passengers to purchase tickets on line and pay with their credit cards is costing travel agents business. Those still booking via travel agents can pay with their credit cards via the agencies who now only earn a 5% commission.

Goeltom accepted that the changes in commission levels by Garuda is a function of the increasingly competitive environment faced by all airlines and the need to reduce costs wherever possible. Moreover, as Garuda moves towards 2010 and the introduction of the ASEAN Free Trade Area, airlines will completely stop paying commissions to travel agents.

According to Bisnis Indonesia, Goeltom, who also serves as the Secretary of the Association of Indonesian Ticket Sales (ASPINDO), has managed to secure an additional 2% commission from Garuda permitting the current commission level to remain at 7%.

Fearing for the future, Goeltom said that 90% of all Indonesian travel agents depend on ticket sales with only 10% selling tour packages. In the future only travel agents who are creative and create new tourism products will manage to survive.