TRAVEL AGENCIES TO TIGHTEN UP AFTER AIRLINE CAPS

Most travel agencies in Cape Girardeau will "tighten their financial belts" and keep operating as usual despite the announcement by some major airlines that they will place a cap on ticket commissions.

Trans World Airlines, Inc., which handles about 70 percent of the flights out of Lambert Field in St. Louis, is the latest airline to put a cap on commissions that travel agents make on airline tickets.

Delta Airlines started the move in early February when it placed a $25 cap on one-way domestic tickets and a $50 cap on domestic two-way airline tickets and lowered its international ticket commissions from 15 to 11 percent.

"This won't have a major effect on vacation travel," said Ann Swanson, manager of Gulliver's Travel Agency Inc., 2424 Kingsway Drive, in Cape Girardeau. "Most vacation travelers select destinations under $500."

The rub comes when travelers are in situations where they can't take advantage of vacation specials, Swanson said.

For example, an air fare from Cape Girardeau to San Francisco could cost from $800 to $1,000. At that point, the travel agency's commission would go from 10 percent -- $80 or $100 -- to $50, or just half.

"You can't pass the cost on the customer in the case of a travel agency," said Swanson.

As many as 10 travel agencies are located in Cape Girardeau, and most will be looking for ways to offset the cap.

Ron Lorenz of Allied Travel Agency, 231 S. Broadview, says, "We'll just have to tighten our belt and try to run more efficiently."

Lorenz said about half Allied's business is corporate travel, which will be hit hardest by the caps.

Business travelers, say travel industry workers, pay top dollar.

"We write a lot of tickets that we lose money on," said Swanson. "We need some of the bigger commission sales to offset that."

Nationally, the average cost of writing a single ticket is about $25 to $30, and that doesn't include the regular overhead, noted one travel consultant.

Along with Lorenz and Swanson, Carolyn Kempf of Elite Travel, 354 S. Silver Springs, and Mark Hill of Destinations Unlimited, 866 N. Kingshighway, agree that adding a service charge for customers is not a good idea.

"We're not even thinking about a service fee," said Kempf. "I wouldn't even entertain that thought."

"A service fee may be a future consideration," said Hill. "But at this time, we're not even considering it."

AAA travel agency spokesman Mike Right announced Friday that the agency would never consider a customer fee for its more than 600,000 members.

"We want our AAA members to know that in addition to discounts on car rentals, cruises and other travel offerings, they can be assured they will not have to pay a fee for airline tickets at our agency offices," Shirley Heiman said in the Friday announcement.

AAA Travel has 22 offices throughout Southern Illinois, Kansas, Arkansas and Missouri, including the Cape Girardeau office at 1903 Broadway.

When Delta announced its capping policy Feb. 5, the American Society of Travel Agents, headquartered at Alexandria, Va., expressed shock and outrage.

"The action is terribly short-sighted and a bottom-line blow to travel agents who are bringing in sizable sales revenue to Delta." said ASTA's president and chairman of the board, Jeanne Epping. "It's a self-defeating strategy for Delta to punish these agents."

With other major airlines joining the commission cap move, ASTA will hold an emergency board meeting this weekend, said Richard Ashurst of the ASTA public affairs department. ASTA has more than 25,000 members in 135 countries.