GOVERNOR Juan N. Babauta yesterday said he would meet with local travel agencies and discuss their concerns regarding the possibility that airlines would gradually lessen their dependence on ticketing agents.
“I want to meet with the travel agents and see what we can do to lessen the impact on them,” Babauta said in an interview.
On Monday, 13 travel agencies asked the government to help them “survive” following the decision of two airlines to scrap their sales commission.
Last month, Continental Airlines and Northwest Airlines removed the 5 percent sales commission that local travel agencies get for selling their tickets.
Travel agents in the Federated States of Micronesia, Palau, Guam and the Marshall Islands are also affected by the new policy.
Local agents said the policy “is slowly choking the travel industry.”
“We implore our elected officials to assist (us),” they told Babauta and the leaders of the Legislature in a letter.
Larry Cabrera, president of Hafa Adai Travel Agency, said travel agencies contribute about $3 million in taxes to the CNMI government every year.
Cabrera said approximately 80 percent of seats on planes plying the Saipan route are sold by ticketing agencies.
“The airlines are actually not doing much. It’s basically a very competitive business for the ticketing agencies. We’re the ones providing services to the traveling public,” he said.
Cabrera said Speaker Heinz S. Hofschneider, R-Saipan, also promised to help travel agencies. However, he said the speaker did not elaborate what actions he would take to address the issue immediately.
The travel agencies fear the gradual introduction of “electronic tickets” which allow customers to purchase their own airline tickets without the assistance of ticketing agents.
The system, according to the agencies, is not ideal for Micronesia.
“In the continental U.S. and Hawaii where the traveling public is more experienced and have the means (computer and credit cards) to purchase airline tickets electronically, airlines are becoming less dependent on agents to sell seats on the plane,” the agencies said.
“The CNMI and the rest of Micronesia are still about 20 years behind. Even corporate businesses in our area that have capabilities to purchase tickets electronically are still buying tickets on credit as they used to 20 years ago,” they added.
