Airlines see leap in ancillary sales

Posted 20/10/2011

Airlines will make 43.8% more from ancillary revenues this year compared with 2010, according to global distribution system Amadeus.

Major US airlines will make 87% more than last year, while low-cost carriers will see their earnings jump 33%. Even full-service airlines, which have fewer extra charges, will see a 28% leap in ancillary revenues.

Amadeus, which worked with consultancy IdeaWorks to produce the projection, found that more carriers were selling ancillary products to lessen the impact of rising fuel prices.

“As ancillary revenues continue to grow rapidly, we are now seeing increasing interest from full-service carriers around the world, which are also starting to implement ancillary services through global distribution systems," said Amadeus vice-president distribution Holgar Taubmann.

"KLM and Iberia, for instance, have just joined the ranks of carriers implementing the Amadeus Ancillary Services solution for travel agencies. The model is now focusing on services which increase the scope of the product offering and reinforce the brand rather than unbundle the ticket price.”

In total, airlines are expected to make $32.5bn from ancillary revenue this year, compared with $22.6bn in 2010.
 

Originally published 20 Oct 2011 at: http://rss.feedsportal.com/c/398/f/5923/s/19688d75/l/0L0Stravelmole0N0Cstories0C11498720Bphp0Dmpnlog0F1/story01.htm