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Singapore Under Pressure

We'll stop promoting Singapore as tourist spot  Feb 08, 2009

They've already boycotted the sale of Singapore Airlines (SIA) tickets in India.

Their next target - stop promoting Singapore as a tourist destination.

Over 2,000 travel agents in several cities in India took to the streets last Friday to protest against SIA's move to scrap commission on ticket sales last November.

Over 1,000 agents participated in the march at Kochi in the southern Indian state of Kerala, 500 agents in Delhi and Bangalore and close to 400 agents marched for approximately 3 km in South Mumbai with banners.

Some 200 agents participated in the action at Kolkata and Chennai. About 150 agents marched in Pune and 40 agents marched in Lucknow.

SIA is the largest foreign carrier operating in India.

The message to SIA - pay us our 5 per cent commission or face the consequences.

But SIA, along with major carriers including Lufthansa and Air France, have said no because of the high cost of jet fuel.

They have told agents to charge the commission to customers instead.

Singapore next casualty?

But should the standoff with SIA continue any longer, the next casualty could well be Singapore, warned the Travel Agents Federation of India (TAFI) national general secretary Ajay Prakash.

He said that the trade will decide to withdraw its support to promote Singapore as a travel destination if the situation does not improve.

Mr Prakash told The New Paper yesterday: 'We want to impress that this could escalate into a bigger situation where we stop facilitating movement to Singapore. We want Singapore Tourism Board (STB) to appeal to SIA to pay the commission.'

He said the federation met an STB representative in India last Thursday to discuss the standoff.

'It's in no one's interest if the standoffs continue. Tourists from India is a key market for Singapore.

'About 779,000 tourists from India travelled to Singapore last year. But this can only come if the trade does actively promote the country,' he said.

About 10.1 million visitors visited Singapore last year, with tourism revenues reaching a record $14.8 billion.

Visitors from India, Indonesia, China, Australia and Malaysia accounted for about 50 per cent of total arrivals.

But these numbers are expected to drop this year due to the global downturn.

Said Mr Prakash: 'Everybody realises that travel has slowed down. It's in no one's interest to have this boycott.

'We all need to be selling tickets and making money. I am not in the business of running protest and boycotts.'

They last met SIA representatives in December but the dispute was not resolved.

For now, travellers in India will have to get their tickets direct from SIA or through online travel portals that are not part of the protest.

They can also travel on other carriers to Singapore.

SIA spokesman Stephen Forshaw said that the company has been in touch with the travel agents in India on the issue of transaction fees in place of commissions and the company remains committed to continue their dialogue with them.

The boycott has not hurt the company significantly.

Said Mr Forshaw: 'For example, our fare specials in India that ran from 29 Dec 2008 to 15 Jan 2009 for travel to Singapore and beyond received a very good response. We are seeing a shift on the part of customers to booking online more now.'

He said that not all travel agents are participating in the boycott, and indeed, many are still booking tickets for their customers on Singapore Airlines flights.

Customers can also buy tickets direct from the SIA website.

Said Mr Forshaw: 'Since the 'boycott' started, we have noticed an increase in sales generated via our website.

'The key message to those travel agents who think this boycott is having an effect is that they are taking business away from their own community and driving it to our website.'

Under the commission model, the airline pays the agent a fixed percentage of the basic fare, irrespective of the services provided by the agent to the customer.

The agent who provides a better level of service receives the same amount as one who provides a basic service.

SIA believes that this is an outdated model and many travel markets worldwide, including here in Singapore, have moved away from this, in favour of service fee-based models.

The STB could not respond by press time.

We'll stop promoting Singapore as tourist spot
Anti-SIA protest in India / Image via

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