Posted on: Wednesday, September 5, 2001

Carnival halves commission for air travel

Bloomberg News Service

Carnival Corp., the world's largest cruise line, said it is cutting in half the commission it pays to travel agents for booking air travel to some of its cruises, a move to keep its prices competitive.

Carnival's Carnival, Holland America and Windstar cruise lines are cutting the airplane-ticket commissions to 5 percent from 10 percent of a ticket's cost, said Carnival spokeswoman Jennifer de la Cruz. The 10 percent to 20 percent commission paid to travel agents for booking the cruises wasn't reduced. The three cruise lines represent about 75 percent of Carnival's cruise capacity, she said.

"The move is intended to keep our prices competitive with what the airlines are offering," de la Cruz said.

The fees make purchasing a plane ticket more expensive for consumers, de la Cruz said.

About 25 percent of travelers booking a trip on Carnival Cruise Lines also buy a plane ticket as part of the package. Ten years ago, 75 percent of Miami-based Carnival's customers purchased the plane ticket and cruise together, she said.

The company's Costa, Cunard and Seabourn cruise lines are considering similar cuts, she said. The cut takes effect Sept. 10 for Carnival cruises and Oct. 15 for Holland and Windstar cruises.

Carnival's decision is a further blow to the travel agent industry. Northwest Airlines Corp., US Airways Group Inc. and other airlines have said they would reduce the maximum commission paid to agents for travel between the U.S. and Canada to $20 from $50 for round-trip flights. Airlines are trying to cut costs by selling more tickets over the Internet.