TORONTO — There were big airlines at the Lufthansa Group Travel Forum in Toronto yesterday – and big topics for the panel discussion and its three airline execs, plus a Q&A session with advisors.
Air Canada’s Director, Corporate Sales, Ana Paula de Souza, along with United Airlines’ Director, Global Corporate Sales, John Holt, and Christina Meakin, Director of Sales, Lufthansa Group, say the demand for travel – no matter what is happening in the world – is still there.
But jet fuel prices are wreaking havoc.
“WHEN I WAKE UP, THE FIRST THING I DO IS CHECK THE FUEL PRICE”
“For us, it’s about adapting to this new environment,” said de Souza. “Every morning when I wake up, the first thing I do is check the fuel price because that gives me a pretty good indication of how my day is going to go. Unfortunately, that’s the situation we’re living in right now. But the demand is there, which is positive. Travel continues to be resilient.”
De Souza added: “At Air Canada, we’re focused on being agile and moving capacity to where we see strong demand. You’ve probably seen us changing routes here and there, and that’s really about adapting to the environment.”
She said customers are still prioritizing international travel, but booking closer in. They’re also focusing more on flexibility and value.
The jet fuel impact for United? “It’s adding about $6 billion to our bottom line,” said Holt. “When prices come down, we’ll be able to pass some of those savings back to customers. But at the moment, fuel is one of our biggest risks.”
Lufthansa Group hedged about 86% of its fuel for the remainder of the year, giving the airline group some stability and help mitigating volatility, said Meakin.
Uncertainty has become a familiar word in the travel industry, and cost of living concerns from consumers. “Despite all the pressure they’re facing, they continue to prioritize travel over other lifestyle expenses, which is encouraging,” added Meakin.
PREMIUM TRAVEL DEMAND
Demand for premium air travel is especially strong, for all three of the airlines.
“Premium leisure is huge for us,” said Holt. “If you look at aircraft cabins today, it seems like there are fewer and fewer economy seats, and that reflects the shift we’re seeing.”
He added: “I sometimes have to remind myself that while I may not personally have the money to fly in a Polaris Suite, many of our customers do.”
High-service lounges are a priority for all three as well. “We’ve made significant investments as well, including upgrades to our Signature Class experience, lounges, WiFi and Bluetooth connectivity,” said de Souza. “Everyone is looking for a more unique experience, and we have to follow that demand. Premium demand is very strong. Some of our frequent travellers are even finding it difficult to upgrade into Signature Class because those cabins are so busy.”
Lufthansa Group has new SWISS lounges coming in Zurich and, with the move to the new Terminal 6 at JFK, will also be launching a major flagship lounge there. Onboard, said Meakin, more customers are looking for individualized, highly customized travel experiences, with more space and privacy onboard, and the latest tech.
De Souza and Holt both see the new A321XLRs for Air Canada and United as a game-changer, opening up unique, secondary and non-traditional markets, especially to Europe. “When you look at our European expansion, it’s the perfect-sized aircraft. We’ve been able to serve destinations such as Berlin, Budapest, Catania, Palma de Mallorca and the Azores nonstop,” said de Souza.
CANADIAN EXPANSION
Meanwhile Meakin spoke to Canadian expansion. “All eyes are on Canada,” she said. “We currently have five Canadian gateways, and we hope to expand that going forward.”
Edelweiss, SWISS’s sister airline, is launching an entirely new long-haul product with redesigned cabins, including new business suites. Canada will be the launch market, beginning with Halifax in June, followed by Calgary and Vancouver.
Discover Airlines is also launching a completely redesigned product called Ocean Blue, “which we hope to see in Canada next year,” said Meakin.
Lufthansa Group is also rolling out Starlink as its WiFi provider. “The first aircraft have already been equipped. We have about 850 aircraft across seven airlines, so it will take some time, but it’s a major step forward for us,” said Meakin.
In addition to Star Alliance membership, Air Canada, United and Lufthansa Group are also Atlantic Joint Venture partners. Asked about the benefits for travellers and the trade, de Souza and Holt highlighted frequent flyer integration for onboard WiFi as a small perk that can make a big difference.
Lufthansa Group has expanded recognition and benefits for its corporate preferred customers, and Air Canada and United are looking at similar initiatives as well, said Meakin.
Coming up for the three carriers, on the corporate side: working together on a Sales Insights Hub, offering automated business reviews, additional value-added features, enhanced reporting and greater transparency.
PAIN POINTS
Holt said that for United, group bookings are one of the carrier’s biggest pain points.
“I know many of the accounts in this room do significant group business with us, and the process isn’t always seamless. We’re investing in a vendor and new technology to improve that process. We want to become a faster and easier airline to work with for groups, and that’s something we have in the pipeline,” he said.
A pain point for Lufthansa Group: unused tickets. “With so much volatility in the market, we want to have a solution that allows corporate customers and agencies to store and manage unused tickets and make them available for future use,” said Meakin. “Air Canada and United already have solutions in place, so we need to catch up and, importantly, align our policies.”
She added: “For travel advisors, the goal is to make things easier so you’re not dealing with three completely different policies. Unused ticket management is definitely something we have in the pipeline for next year.”
TRAVEL ADVISOR Q&A: NDC, SERVICE LEVELS & COMMISSION CUTS
The big questions from advisors (at least, one of the big questions): why is it so difficult to book on NDC platforms?
“Even though NDC has been around for a few years, we still have a long way to go to make it work the way we want it to, both from an airline perspective and an agency perspective,” said Meakin.
“We do believe NDC is the way forward. Ultimately, it should allow agencies to offer customers the same rich content, pricing and dynamic offers they see on an airline’s website. But we have to make sure agencies can actually use it effectively.
She said post-ticket servicing is one of the areas where Lufthansa Group sees the greatest need for improvement, “and that’s something we’re working on.”
Meakin said airlines need to provide more transparency and clarity around GDS aggregators and what they can do for agencies in NDC, as well as the different travel technology providers available.
“There’s a lot out there, and choosing the right solution can be difficult. We want to work alongside agencies and provide guidance while still allowing them to decide whether they want to work through a GDS aggregator, a travel tech provider or a direct API. It’s complex, and we want to continue that journey together with the trade.”
Air Canada’s NDC rollout, back in 2023, came with the Distribution Cost Recovery (DCR) fee to encourage bookings away from the GDS. Three years later, de Souza said Air Canada is now focused on meeting travel advisors where they’re at, and how they want to book.
“At the end of the day, we want to be on the shelf wherever you want to do business with us,” said de Souza.
“If you want to work through the GDS, through an NDC channel or another option, that’s your choice. As long as you’re selling Air Canada in Canada, we’re happy.”
She added: “We will continue moving forward with modern retailing because that’s where we can make more of our content and services available. But it’s ultimately the agency’s decision how it wants to sell Air Canada.”
Technology, and NDC, are here to stay, said all three execs. That said, “collaboration is critical. Agencies need to understand our roadmap, and we need to understand how they want to do business with us,” said de Souza. “Technology gives us the ability to better segment and personalize our business, and that’s one of the capabilities NDC can provide. Some channels will have more content than others, but ultimately the choice belongs to the agency.”
The execs also spoke to service levels between airlines and the trade. “Nobody wakes up in the morning thinking, ‘I can’t wait to make someone deal with 16 schedule changes and then have trouble checking in on the right app,’” said Holt. “A lot of it comes down to technology and the complexity involved. What I can tell you is that I speak to our leadership teams and give them the feedback I hear from you. We do take it seriously, and we try to fix what we can.”
Heads were nodding as one travel advisor said her premium clients aren’t keen on Air Canada’s Premium Economy Basic and Business Class Basic fares, introduced in July 2026: “I don’t want to touch them. I don’t want to deal with them in the GDS or NDC. My clients are premium clients and they want service. I don’t want to sell Basic fares, so I think keeping those fares on the website would make things easier for us as well.”
De Souza said it’s about giving consumers options. “Trust me, we don’t necessarily want you selling Basic fares either. But we need to offer different options because there is a segment of customers that wants to buy Basic.”
The same travel advisor asked about “the elephant in the room: commission levels.”
De Souza said Air Canada didn’t want to be the industry leader in reducing compensation. The airline cut commission this summer. “These are difficult decisions. We need to make sure the business remains sustainable and that we’re here for the long term,” she said. “When fuel prices are at the levels we’re seeing today, it becomes even more difficult. I’m not saying the trade should have to pay that bill. But we have had to make difficult decisions across every level of the company, including with our employees and with projects that we had planned. We’ve had to adapt everywhere in order to remain sustainable.”
De Souza thanked advisors “for sticking with us. There is a lot of investment happening that will ultimately benefit our mutual customers.”
Lead image caption: Christina Meakin, Director of Sales, Lufthansa Group; United Airlines’ Director, Global Corporate Sales, John Holt; Air Canada’s Director, Corporate Sales, Ana Paula de Souza, at the Lufthansa Group Travel Forum in Toronto
