IN BRIEF: February 2019 issue
AFTA challenges NSW government
The Australian Federation of Travel Agents (AFTA) made a submission in December 2018 to a NSW Government reform proposal, which would potentially force travel agents to disclose margins and commissions. The controversial plan by NSW Minister for Better Regulation, Matt Kean, captures the travel industry (perhaps inadvertently) alongside financial intermediaries such as banks and insurance companies, requiring the disclosure of the existence of commissions and referral fees.
AFTA’s submission “strongly advocates for the exclusion of travel intermediaries” from the operation of the amendments to the state’s Fair Trading Act 1987, citing the unique nature of the sector. “The reforms are both economically burdensome on the travel industry and unnecessary,” AFTA noted, highlighting the crucial role played by tourism and travel in the NSW economy.
While acknowledging that further regulation may be required to address concerns relating to commissions and referral fees in certain sectors, “existing industry regulation and obligations under the Australian Consumer Law already provide a robust framework to prevent misleading an deceptive conduct in the travel industry, without the unintended consequences that may result from the additional regulatory burdens imposed,” AFTA noted.
Express NZ expansion plan
Express Travel Group has set its sights on trans-Tasman expansion, confirming that it is the interested party in a rumoured majority investment in First Travel Group NZ.
A “Term Agreement” signed in mid-December includes a 90 day exclusivity period, with the proposed investment seeing both organisations continue with business as usual. However shared technology and systems will allow both companies to enhance their customer experience in both retail and corporate, according to ETG CEO Tom Manwaring.
“Express Travel Group and First Travel Group are both strong fully integrated, independent businesses, having maintained a close relationship for many years,” he said, with key commonalities including strong local management, shared preferred partners, technology, customer segments and complementary company values and culture.
The move looks to have prompted a reaction from Helloworld, which just before Christmas announced two new members who were formerly part of First Travel Group — Barlow Travel and Gilpin Travel, with a combined TTV of more than NZ$100 million.
Helloworld NZ Executive General Manager, Simon McKearney, welcomed the additions, commenting that “many agencies want surety of their direction and future and hence the attraction of Helloworld”.
Helloworld steals Show
Helloworld also expanded on this side of the Tasman, announcing the acquisition of the business of Show Group Enterprises from its long-time owner, the Avis Budget Group.
Helloworld CEO Andrew Burnes said the transaction would allow HLO to expand in the specialised travel and logistics segment, complementing its existing corporate business.
The acquisition includes all of the Show Group brands such as Show Sport, Show Corporate, Show Travel, Show Film, Show Event, Show Fashion, Show Leisure and Show Freight, with the company confirming it would continue to be led by the existing team of Lyn Keep, Head of Supplier Relations; Glenn Cusack, Head of Sales & Client Management; John Kline, Head of Supplier Relations; and Group General Manager Cathy Barnes.
The strong period for Helloworld also saw its QBT Limited corporate division appointed as the sole provider of travel management services to all of the 43 South Australian Government agencies for a three year period taking effect from 1 February.
Flight Centre acquires
Flight Centre was also on the acquisition trail last month, announcing two quite different deals — the purchase of a Silicon Valley corporate travel business, as well as a long-term lease on a Bali hotel. The 10-year accommodation deal is for the four star Camakila Legian Bali Hotel, a beachfront property which will become part of FCTG’s Bespoke Hotel Management Asia (BHMA) division. The 117-room Camakila has been rebranded as Away Bali Legian Camakila, and is already popular with Flight Centre’s Leisure customers, according to MD Graham Turner.
Also joining the FCTG portfolio is California-based Casto Travel, a TMC established in 1974 which now has 85 staff and TTV of about US$120m. Turner said the deal would give Flight Centre “greater scale in Silicon Valley and in the large West Coast market, where we previously had a relatively small corporate presence”.
Major boost for Kakadu
The Northern Territory’s Kakadu National Park is set for a significant infrastructure upgrade, with both major political parties announcing more than $200 million in funding. A ten-year-commitment from the Coalition includes $5 million to relocate the visitor centre to Jabiru along with $70 million on road upgrades and $40 million for better campgrounds, walking tracks and viewing platforms.
The Labor Party also has big plans for the region, including $2.5 million to improve mobile phone connectivity, a $25 million new visitor centre and $45 million for asbestos remediation.
Kakadu Tourism Chair, Rick Allert, said the funding would be “crucial in rejuvenating one of Australia’s most important natural and cultural tourism destinations”. He said tourism infrastructure had “really held back the industry from progressing,” noting that many of the park’s iconic spots are often inaccessible. “It is a long way to come for overseas visitors, and they have every right to expect to experience our key waterfalls, swimming holes, rock art and walks for most of the year,” he said.
Baillie Lodges grows
Boutique accommodation specialist Baillie Lodges has already started expanding, following the announcement just before Christmas that US-based KSL Capital Partners had made a “substantial investment in the company”. Founders James and Hayley Baillie will continue to lead the venture, maintaining the company’s “vision and commitment to delivering wild, experiential luxury”. Building on its existing success, operations expertise and distribution network the company is pursuing acquisitions of select luxury lodges to join the Baillie Lodges stable, they said, with the deal coming 15 years after the business was founded in 2003.
The Baillies wasted no time since announcing the KSL deal, following up in short order with the acquisition of Silky Oaks Lodge in the Daintree National Park — a “back to the future” moment for James Baillie, who was GM of the Far North Queensland property when it was first acquired by P&O Resorts in the 1990s.
The “CATOs” join NTIAs
This year’s National Travel Industry Awards will provide further opportunities for the recognition of top performing travel agents, with the addition of new categories in partnership with the Council of Australian Tour Operators. The four CATO Awards will go to a Consultant of the Year in Group Touring, Adventure, Ski and Independent Travel, with the aim of recognising and rewarding front line travel agents.
In a strong show of common purpose, the new “CATOs” are being jointly sponsored by Globus, G Adventures, Intrepid and The Travel Corporation “demonstrating the collaborative focus of the land supply sector,” according to CATO MD Brett Jardine.
AFTA CEO Jayson Westbury said AFTA and CATO had been united in service to the travel industry for well over a decade. “This union to enhance the NTIA program, call out travel professionals working with CATO members all within the high standard set by NTIA is yet another fantastic celebration of the Australian travel industry,” he said.
The 2019 AFTA National Travel Industry Awards will be held on Saturday 20 July, with nominations now open until 15 February. Travel agents can nominate suppliers, and suppliers can nominate agencies and individual consultants across a total of 44 categories, with participation in the AFTA Travel Accreditation Scheme (ATAS) required for nominees in the travel agent, tour operator and wholesaler awards.