United Airlines to Start Withdrawing Content from EDIFACT
United Airlines on Sept. 5 plans to remove Basic Economy fares for domestic U.S. and short-haul Latin American flights from EDIFACT and have that content offered only through its direct website or app, or New Distribution Capability-enabled channels, according to a memo from United SVP of worldwide sales Doreen Burse sent to corporate customers and travel management company individuals who have subscribed to receive emails from sales at United for Business.
“Basic Economy fares are designed to work in concert with ancillary sales,” wrote Burse. “EDIFACT is not able to sell ancillaries, therefore it is not an appropriate channel to offer our Basic Economy content.”
United plans to offer informational webinars on the topic in the coming weeks, “to keep lines of communication open and answer any questions,” Burse wrote. In addition, the carrier has a new website dedicated to its NDC offering.
“We think there will be a limited reaction from the business travel space,” Burse told BTN.
“Basic Economy for our business customers is less than one tenth of 1 percent of what they buy,” added United VP of sales strategy and effectiveness Glenn Hollister. “It’s not really about business travel. It really is about the leisure travel side.”
The United move will come about five months after American Airlines in April began to pull up to 40 percent of its content from EDIFACT and make it available only in direct or NDC-enabled channels—a distribution change that came with much consternation from buyers and particularly travel management companies. Many corporate customers and TMCs have cited the lack of communication and collaboration from American prior to that decision being made and carried out.
Burse hopes to avoid the same backlash. United met with both its corporate advisory board and travel advisory council to discuss the planned removal of Basic Economy from the EDIFACT channel. “The conversations were very open and positive and specifically what we heard from both groups was ‘thank you for being transparent,’ ” Burse said. ” ‘Thank you for continuing to meet with us, and thank you for continuing to keep us posted.’ This is the way we work and collaborate with them in an ongoing basis. There were no real surprises.”
“We’ve been involved with not only those groups but also a lot of individual players for a couple of years,” Hollister said. “The announcement really is the result of all that input over an extended period of time.”
Burse also reiterated what was included in her memo: that United’s objectives are to support an omni-channel approach to distribution and to support all customers’ buying channels of choice, to have ongoing “strong collaboration” with all parts of the value chain to align distribution costs with value while reducing economic differences between channels, and to continue “investment in modernizing buying options including expanding NDC and direct channels’ capabilities.”
When asked what the endgame was for NDC and how long there would be both EDIFACT and NDC channels, Burse reinforced that United has “and omnichannel approach, and we that as the approach for at least the foreseeable future,” she said. “As far as the near-term, as far as removing everything from EDIFACT channels, that is not on the roadmap.”
Hollister agreed, but noted that “in the long-term, maintaining both EDIFACT and NDC does not make sense,” he said. “There are a lot of hidden costs in our business due to EDIFACT. I do believe there will be an end-of-life someday for EDFIACT. That end-of-life will happen after the great preponderance of our partners have moved to NDC. We are not looking to create a cliff or something that creates a crisis for them. We want them to move and will support them moving.”
Donna M. Airoldi www.businesstravelnews.com