Travelport Dismisses AA's Allegations As 'Ludicrous and Without Merit'
Travelport Will Vigorously Pursue All Legal Rights and Remedies
Travelport, the business services provider to the global travel industry, today announces that it intends to vigorously defend against a ludicrous and meritless antitrust lawsuit filed by American Airlines (AA) in Fort Worth, TX.
AA's antitrust complaint contains significant factual inaccuracies, including, for example, wrongly stating that Galileo, a Travelport GDS platform, operates in the United States -- which it has never done. There are also many disparaging comments about Travelport's technology which are not borne out by facts including recent airline adoption of Travelport's merchandising capability or innovation such as the ground-breaking Travelport uAPI.
The complaint also finds fault with Travelport/AA's longstanding distribution agreement -- through which AA benefits from significant discounts -- some five years after its initiation and at a time of renewal.
In unsuccessful negotiations and now in litigation, AA seeks to limit consumer choice in shopping for fares and to limit consumer access to other relevant data. Travelport's aggregation, search and shopping allows travel agents and consumers a full range of choices across over 400 airlines. Travelport believes that AA's plans to force a more restrictive distribution model would result in inefficiencies and considerable added costs ultimately to be paid by consumers.
Travelport believes this lawsuit is merely another attempt by AA to gain bargaining leverage through litigation. AA's unfortunate choice to litigate frivolous positions, rather than engage in fair and constructive negotiations, leaves Travelport with no alternative except to defend these claims vigorously and to take all appropriate legal action.
Notes :
- According to Travelport estimates, only 13% of all airline passengers boarding flights in the United States purchased their tickets through Travelport's GDS travel agent subscribers. These subscribers earned an average distribution fee of (1.2%) less than 2% of the average ticket price. In comparison, the average distribution expense for a US hotel is 1.5 % of the cost of a stay.
- Over the last five years, Travelport estimates that the distribution prices paid by US airlines to Travelport have declined by 18%. On a real or inflation adjusted basis, distribution prices charged to US airlines have declined by 24% over the last five years.
- Google, Bing, Yahoo!, and Kayak are strong new entrants in the distribution of airline tickets. Their business models often bypass GDS distribution in favor of directing consumers to airline websites.
- AA made no mention of any material impact to the company as a result of any action by Travelport in its most recent earnings release to investors and in its regulatory 10-Q filing.
SOURCE Travelport
