Aer Lingus and 10 of Europe's leading airlines are to set up an Internet travel agency. The move will not be welcomed by travel agents who face increasing pressure on their margins.
It was reported yesterday that some European travel agents had filed objections with the EU on the move. Travel is the largest online revenue sector in Europe and is forecast to grow from $8 billion (€8.9 billion) in 1999 to $29 billion by 2003.
The Web portal, due to start operations around the end of the year, is regarded as a cornerstone of the industry's drive to use e-commerce to make savings of millions of pounds in ticket sales and marketing costs.
The initiative is also part of a broader response by the travel industry to the wave of start-up online travel agencies, such as travelocity.com, expedia.com and ebookers.com.
A similar development, called T2, was announced in January by four of the leading US carriers: Delta Air Lines, United, Northwest and Continental Airlines. It is due to go live later this year.
British Airways, which has been one of the driving forces behind the European joint venture, said yesterday it would offer the public access to the most up-to-date fare information, including the airlines' lowest branded fares. Travellers will also be able to book hotels, car hire, insurance and other travel services through the site.
British Airways recently became an alliance partner of Aer Lingus, along with American Airlines. Low fares carrier Ryanair launched its own online booking service earlier this year, a move which has been incredibly successful. The company's initial aim was to get 30 per cent of its sales online by the end of this year.
In contrast, Aer Lingus has been far slower off the blocks. It has employed consultants to advise it on its Internet strategy but was not expected to have its own online booking service in place before the end of this year.
An Aer Lingus spokesman was unavailable last night.
Ownership of the European site is expected to be dominated by Lufthansa, BA and Air France, with smaller stakes for the other carriers who also include Alitalia, KLM, Iberia, SAS, Austrian Airlines, British Midland and Finnair.
Irish Travel Agents' Association chief executive, Mr Brendan Moran, said recently that online reservations were just a new form of distribution which needed to be adapted to. He argued that travel agents would preserve their position in the market because they were the best independent source of travel information.
