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El Al has announced that from the 1st October 2009 they will cease paying basic commission of 7 percent to travel agents on the sale of tickets in ‘El Al Basic’ class.

Is El Al on their way to zero commission? The marketing department of the company announced to travel agents that from the 1st October they no longer intend paying basic commission on the sale of tickets in IATA class E, discounted economy.

As mentioned a couple of months ago, El Al launched a new class, on the basis of offering low cost fares without any of the accompanying services, such as meals, baggage check in being included in the price of the ticket.

The message to the travel agents includes technical training on how to reserve seats and services on basic economy class through the travel agent, with the emphasis that the sale of basic economy class seats will not pay commission to the agent.

According to Danny Saadon, branch manager of El Al in Israel, who delivered a speech at a conference organized by Lachish Tours, El Al intends to consider the model of zero commission as soon as there is the expected recovery in passenger traffic .  In the last year, based on the El Al 2010 plan, the company leveraged its reservations service significantly and those in charge quoted their intention to continue to encourage passengers to purchase tickets by this method.

A spokesperson for El Al responded that at this time there is no intention to cancel basic commission based on the business model of basic economy class.  The travel agent has the option of collecting a handling fee according to their consideration.