Singapore Airlines Implements $12 GDS Surcharge to Push NDC Adoption
Singapore Airlines has implemented a $12 surcharge for bookings made through global distribution systems, effective January 4, 2021. The move, aimed at encouraging corporate travel agencies to use the New Distribution Capability (NDC) channel, could potentially reshape the travel industry worldwide.
The airline's action comes as many carriers in Europe are reviewing their distribution strategies. Some have started removing cheaper fares from global distribution systems, indicating a shift towards NDC. While the search for airlines following Singapore's example is ongoing, the U.S. market may also see similar changes from airlines like American Airlines, United Airlines, and Southwest Airlines.
The NDC model, however, could potentially reduce travel agents' productivity due to multiple booking channels. Corporate travel agencies without NDC capability may face disadvantages or additional costs. Tickets booked through the NDC channel will not incur a distribution fee, making it an attractive alternative for agencies.
Singapore Airlines' surcharge is now in effect in territories including Singapore, Indonesia, Australia, New Zealand, the UK, Germany, and Switzerland. As more airlines review their distribution strategies, the travel industry may witness significant changes in the coming months. Corporate travel agencies are encouraged to adapt to the NDC channel to avoid potential penalties and maintain productivity.
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