Cheapest airfare might be on airlines' own website

Associated Press Modified: September 12, 2012 at 8:31 am •  Published: September 12, 2012
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NEW YORK (AP) — Some airlines are making travelers work harder to find a deal.

Carriers are offering more deals to passengers who book flights directly on their websites. It's an effort to steer people away from online travel agencies such as Expedia, Orbitz and Travelocity, which charge the carriers commissions of roughly $10 to $25 a ticket.

While travelers save money, they also must do without the convenience of one-stop shopping.

Frontier Airlines is the latest carrier to jump into the fight, announcing Wednesday that it will penalize passengers who don't book directly with the airline. Those fliers won't be able to get seat assignments until check-in. And they'll pay more in fees while earning half as many frequent flier miles.

"Particularly for families, it provides an incentive to book directly," said Daniel Shurz, Frontier's senior vice president, commercial. "There is no logical reason for our customers to want to book anywhere else."

Contracts with the online travel agencies prohibit airlines from offering lower fares on their sites. Instead, airlines such as JetBlue Airways Corp., Spirit Airlines Inc. and Virgin America often provide discount codes in emails to their frequent fliers or through Facebook and Twitter.

The savings for booking directly can be significant.

Toronto-based Porter Airlines frequently offers codes that save travelers up to 50 percent. A recent search of flights from Chicago to Toronto for November produced an airfare of $249.61 using a code at flyporter.com. The same flights would have cost $404.38 through Travelocity.

The airlines face a delicate balance. The online travel agencies account for the lion's share of ticket sales. But the airlines want to trim the fees that eat into their profit margins.

Besides the discounts, the airlines say their sites offer passengers a better experience, providing up-to-date seat maps, details about in-flight entertainment and more seamless booking.

Henry Harteveldt, co-founder Atmosphere Research Group, said the airlines and travel sites have "a very, very dysfunctional business relationship." The travel sites treat all flights equally. Price is the only differentiator.

"The online travel agencies either won't or can't talk about how an airline might have Wi-Fi on a plane or extra legroom seats available," he said.

The online agencies say they provide travelers with several advantages, including comparison shopping and the ability to mix and match airlines for a single trip.

"That's something you can't do on an airline's site," said Dara Khosrowshahi, president and CEO of Expedia, Inc.

Simon Bramely, vice president of transportation and lodging for Travelocity, part of Sabre Holdings, noted that "the flight is one element of the trip." He said online travel agencies can save travelers hassle and money by creating packages that include hotel rooms and car rentals.

The battle is not new. Southwest Airlines Co. was a pioneer in cutting out the middleman. The airline does not list its fares on third party sites. That means travelers have to search both southwest.com and then elsewhere to compare fares. Southwest hopes fliers will never make it to another site.

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