By Kim Rahn
Staff Reporter
Korean carriers' move to cut commissions they pay on ticket sales to travel agencies is drawing protests. Travel agencies are claiming that the commission reductions will force many of them out of business due to falls in income.
Chung Woo-sik, chairman of the Korea Association of Travel Agents, said Thursday that the reduction will make travel agencies lose huge portions of their revenue and thus a large number of agents will lose their jobs.
When a customer purchases a flight ticket through a travel agency, Korean Air and Asiana Airlines used to give 9 percent of the ticket sales to the agency as commission. Now, Korean Air plans to cut the rate to 7 percent starting April, and Asiana, the same from May, meaning commission income could be cut by as much as 22 percent.
``The carriers, which make hundreds of billions of won in revenue, decided to cut the commission unilaterally. It's like an abuse of their power against poor agencies,'' Chung said in a press conference in Seoul.
He claimed about 20,000 workers in the tourism industry are expected to lose their jobs.
The commission usually makes up some 60 percent of small- and medium-sized travel agencies' revenues. However, it is also said the agencies should try to make money not through commissions but through developing various tourist programs, as it is a worldwide trend.
Officials of the two carriers said that travel agencies' role in flight ticket purchase is decreasing following the adoption of e-tickets and growing online sales, and thus the commission, which has remained static for the last 40 years, should be reduced.