Qantas to Lower Agent Commissions

SYDNEY, 08 September 2004

Qantas said today that it would change its travel agent base commission structure for international, domestic Australian and domestic New Zealand travel sold in Australia.

Qantas Head of Sales and Distribution Rob Gurney said that under the new structure:

* Australian domestic base commissions would be reduced from five per cent to one per cent from July 2005;

* trans-Tasman and New Zealand domestic base commissions would be reduced from five per cent to one per cent from January 2005; and

* international base commissions would be reduced from nine per cent to seven per cent from January 2005.

"Airfares have never been more competitive, with travellers enjoying very low pricing for both domestic and international destinations. However, distribution costs remain high and the current base commission structure is simply not sustainable in such a low fare environment," Mr Gurney said.

"Base commissions are only part of the remuneration that many travel agents receive from airlines.

"Other airlines have made similar changes in overseas markets, with travel agents adjusting to new remuneration models, including the collection of service fees."

Mr Gurney said Qantas would be consulting closely with the industry and would provide every possible support for agents in the coming months.

"We are also in close consultation with the Australian Federation of Travel Agents (AFTA) concerning issues relating to new remuneration models for agents and are confident that we will be able to work with the industry to develop a suitable model going forward," Mr Gurney said.

Issued by Qantas Corporate Communication (3145)