AIR France is to cut basic commission to 7% on April 1 and bring in an incentive scheme to give agents the opportunity to earn up to 11%.
The move will leave around 10% of the carrier’s poorest producing retailers earning 7% commission instead of the current 9%.
UK and Ireland commercial director Thierry de Bailleul claimed the decision to reduce payments was not for cost-cutting reasons. The carrier currently pays £8.5m commission per year to UK agents.
He said:”Several hundred agents will benefit, not just multiples and business agents but smaller retailers as well.
“We are not trying to cut commission but are looking for more support in our relationships and trying to maximise our revenue.”
ABTA aviation committee chairman Sandy MacPherson said he was disappointed with Air France’s decision but approved the chance for agents to earn extra commission.
“Air France is incentivising agents, and ABTA welcomes that,” said MacPherson.
De Bailleul would not say what targets agents will have to reach in order to gain increased commission but he did say there were certain criteria the airline will be using.
“We will be looking at how much extra capacity we are putting into an area and the market growth potential for each agent,” he said.
De Bailleul admitted British Airways’ move to axe commission had given Air France an opportunity to sign up agents by keeping payments.
However, he said Air France will study BA’s plan and may follow in the future.
Air France will offer more agents net fares which they will be able to increase in price if the market allows.
The airline is to keep UKcapacity at current levels this year after last year’s 30% rise, apart from Southampton-Paris flights which will increase to three a day from double daily on March 26.
De Bailleul said that Air France’s franchise agreement with Gill Airways is to remain for the time being despite the UK airline calling in administrators earlier this month.
The national French carrier will roll-out Internet bookings for UK customers later this year. Currently only US-based passengers can book on-line.
Air France is also planning to invest in electronic ticketing at UK airports this year to speed up the airport process.
Launched: April 1.
Basic rate: 7%.
Extra commission for increased sales: 8%-11%.
Who qualifies for extra commission?90% of agents.
What agents need to achieve for more commission? Confidential – but Air France said it will put targets in line with capacity increases and the opportunity for sales growth.