Agents Ask Travelers To Start Paying Fees

The days of getting free service from your local travel agent may be coming to an end.

Breaking with decades of tradition, American Express Co. says some of its travel agencies have started charging vacationers “service” fees to make up for lower commissions from discount carriers. American Express’s fees range from $5 to $25, but some smaller agencies are demanding as much as a $100 cancellation fee for extensive trip planning.

“This is going to go over like a lead balloon,” says Steve Landes, director of the South Florida Airline Commuters Association. “I really don’t think your typical traveler is going to stand for this.”

Travel agents traditionally haven’t charged customers for booking vacations because they were earning enough from airline, hotel and carrental commissions, which are equal to about 10 percent to 15 percent of a customer’s bookings. (Large agencies have recently imposed fees on corporate customers.) So far this year, the nation’s 30,000 travel agents have collected $5.8 billion in airline commissions alone, 6 percent more than last year.

But travel agents say commissions haven’t kept up with the cost of issuing an increasing number of lowprice tickets from carriers like Southwest Airlines and Continental Lite. In addition, more travelers now book frequent-flier tickets directly with airlines and ask agents to book the rest of a trip. That’s a bad deal for travel agents because hotel and rental commissions are smaller than airline commissions.

So American Express said it started charging some walk-in and non-repeat customers $5 to $25 to book airline tickets that cost less than $100 and to make certain overseas hotel reservations. There are other fees, but the company wouldn’t provide details other than to say it planned to roll out a structured system early in 1995.

“The time has come,” says Roger Ballou, president of the division that runs American Express’s travel agency business, the largest in the United States with more than 1,700 locations and $12 billion in travel sales. “We’ll lose some business, but it’s going to be the kind that was costing us money.”

In Phoenix, it’s where Davidson Travel has gone. According to owner Sande Davidson, new customers receive a listing of a dozen fees for everything from visa processing to dinner reservations. Travelers who want a long trip planned must put down a $100 deposit, which is nonrefundable if the trip isn’t taken.

“We get some complaints,” says Davidson. “But we can’t be expected to do our work for free.”

Consumer advocates say the trend may encourage more travelers to book directly with airlines.They say many travelers don’t need agents as much in an era when there are fewer airlines and travel agency reliability has come under question.