NWA likely to be the first US airline to issue only electronic tickets: media
Northwest Airlines is being tipped to become the first US airline to switch over to a system in which only electronic tickets will be issued to customers. (2/26/2007)
According to Pioneer Press, in December, the airline’s issuance rate of e-tickets reached 99.9 percent nationally (98 percent globally). The airline issues more than 30 million tickets a year. The report added that other US carriers, such as Continental Airlines with a 97 percent e-ticket rate, are on Northwest’s heels as the global industry moves toward the goal of erasing paper tickets by the end of the year.
Al Lenza, Northwest’s vice president of distribution and e-commerce, sees a future where technology will help airlines better monitor and manage overbooked flights and help customers better search online for customised travel options.
“All of this self-service allows you to do things that were impractical before,” he reportedly said.
The IATA estimates that e-ticketing will save the worldwide industry $3 billion a year. It costs $1 to produce an e-ticket vs. $10 for a paper ticket.
According to the same report, airlines also save money on postage to mail tickets,paper-processing costs and distribution costs. Northwest’s distribution costs have fallen 40 percent to 50 percent in the past five years, in part because of lower travel-agent commissions and more online sales, Lenza shared.
“Certainly, cost savings is a factor but it’s not the dominant factor,” he reportedly said. “In the travel industry, if you don’t have (automation), you’re not a competitor – you’ll lose business to other websites and other airlines.”
Earlier this month, Northwest Airlines Corporation reported a full year 2006 pre-tax profit of $301 million before reorganisation items which compares to a full year 2005 pre-tax loss of $1.38 billion before reorganisation items. Including reorganisation items, Northwest reported a full year 2006 net loss of $2.8 billion versus a $2.56 billion net loss for the full year 2005.