SYDNEY, 25 September 2023: The Australian Travel Industry Association (ATIA) pressed for urgent reform during a briefing session with the Senate Committee Inquiry into Australia’s Bilateral Air Service Agreements.
ATIA’s submission to the Senate Committee Inquiry highlighted the critical flaws in the existing system, where decisions often lack a comprehensive understanding of their impact on passengers. The need for reform is glaring, as it is crucial that all stakeholders, not just airlines, have a direct say in determining supply and demand.
It also raised some unintended effects of the New Distribution Capability (NDC) on Australian consumers. NDC’s adoption has allowed airlines to assume the role of sole price makers, enabling them to enhance profit margins on their most affordable products without market competition pressure.
“This transformation has resulted in notable consequences that have serious ramifications for Australian consumers and the agents who support them,” AITA claimed in its submission.
ATIA CEO Dean Long commented: “The Senate Committee Inquiry offers a pivotal opportunity to address the issues that have long plagued Australia’s aviation industry and air ticket distribution landscape, with ATIA taking the lead in this fight for our members and the broader travel industry.
“The current system determining which airlines can operate in and out of Australia was established in 1944. This system was designed to protect the interests of national carriers, which were largely government-owned at that stage. While times have changed, the system has not.”
“Despite ATIA’s members selling a staggering 10 million tickets, amounting to a total value of AUD14 billion over the past 12 months until August, the Department of Transport fails to consider their perspective when deciding which bilateral aviation agreements to approve.”
“There is a critical and compelling need to redefine national interest in decision-making. ATIA’s submission highlights the critical flaws in the existing system where decisions are made without a comprehensive understanding of their impact on passengers.”
“Our submission also highlights the detrimental effects of the New Distribution Capability on Australian consumers.”
“We are seeing the current application of NDC translate into limited choices for Australian consumers and businesses, increased airfares, and a further reduction in competition within the air ticket distribution market.”
“We have a good relationship with our airline partners and look forward to working further with them on NDC’s adoption to address these issues for Australian consumers and the agents who support them.”
The Australian Travel Industry Association (ATIA) is the peak body representing Australia’s AUD69 billion travel industry. ATIA represents the majority of Australian travel agents, corporate agents, tour operators, wholesalers and ITOs. 92% of ATIA members are small businesses, with women making up 72% of the workforce.