Delta's Calendar, Lufthansa's Clock

Eric Marketts

Three weeks ago, in Episode 21, we asked Delta a yes or no question. Delta has described its new NDC as anchored around servicing, which means everything that happens after the ticket is sold. Changes, cancellations, refunds. We said that if servicing works on launch day, that is real. If it comes later, it is a promise. In late September, Delta laid out its schedule. This week we read it.

Steph Nell

Welcome back to The V1 Airline Retailing Report. I'm Steph Nell.

Eric Marketts

And I'm Eric Marketts. Three narratives this week. Narrative one is Delta's launch list and its twenty twenty-seven roadmap, and what they say about the question we asked. Narrative two is Lufthansa Group's trial of a twenty-four hour price hold for corporate NDC bookings. Narrative three is the cost of AI on both sides of the sale. Two executives on one stage agree AI costs more now. One of them says it can also cut servicing cost in half.

Steph Nell

The through-line is the work around the sale. The approval before it and the servicing after it. Delta published a schedule for the servicing. Lufthansa published a clock for the approval.

Eric Marketts

Let's get into it. Before the news, a word we have to get right. Steph, for anyone new to the show, what do we mean by servicing?

Steph Nell

Think of buying a car. The showroom is where you buy it. The service department is where you deal with it afterward. Servicing, for an airline, is the service department. You change a flight. You cancel one. You get a refund. The airline cancels on you and someone has to rebook you. Selling the ticket is one transaction. Servicing is everything after it, and it is where the cost and the complaints pile up.

Eric Marketts

And why does that matter for NDC in particular?

Steph Nell

NDC is the airline industry's standard for selling products, not just seats. A fare, a bag, a seat and a perk in one offer. The GDSs, which are Amadeus, Sabre and Travelport, the companies whose systems travel agents use to find and sell flights, carry NDC now alongside the older way. On the older system, agents change and cancel tickets with tools they have used for decades. The open question for NDC has always been whether a change is also a button. Shopping was the easy half to build. Servicing is the hard half.

Eric Marketts

Now the news. On September twenty-fifth, Business Travel News reported what Delta laid out the day before, at a digital Delta Business Showcase event, about its NDC launch. The report quotes Patrick Crowley, a Delta director of sales and distribution innovation. We could not find Delta's own release with the full list, so treat the quarter by quarter detail as one outlet's reporting.

Steph Nell

The first release is due by the end of this year. In Crowley's words, it delivers the core capabilities needed to support U.S. point-of-sale activation. At launch, agencies can shop flights, see private fares, settle through ARC, get order change notifications, make voluntary changes on tickets that are wholly unused, and apply corporate priority benefits. The report also lists cancelling ticketed and unticketed orders, and free seat selection.

Eric Marketts

Two terms in there. Private fares are fares a company negotiates with Delta that only that company's travelers can see. Corporate travel runs on them. And ARC is the Airlines Reporting Corporation, the U.S. clearinghouse that settles ticket sales between agencies and airlines. Settling through ARC means agencies keep the payment rail they already use.

Steph Nell

Then the roadmap. The first quarter of twenty twenty-seven adds, among other items, changes to bookings that involve private fares. The second quarter adds an unused-ticket solution, paid seats, enhanced bag allowances, and the ability to add SkyMiles for Business identifiers to NDC orders, which Business Travel News says lets enrolled companies earn miles for their travelers' flights. The third quarter adds post-purchase upgrades, international points of sale, and the ability to change passenger information. Crowley said, quote, customers and partners can expect ongoing quarterly releases as we continue to expand functionality, improve servicing and deliver additional value over time.

Eric Marketts

So what is the bull case?

Steph Nell

Delta plans to launch a defined core in one market and has put dates on the rest. Cancellation is on the launch list, and so is changing a ticket that has not been flown. Separately, Delta announced proactive servicing tools for agency partners, built to help them stay ahead of disruptions, with real-time monitoring and faster routing to specialized support. That is Delta investing in the service department outside NDC.

Eric Marketts

And the bear case?

Steph Nell

Read the roadmap as a corporate travel manager. Corporate travel runs on private fares. The launch list includes seeing them. As reported, changes to bookings that carry one are listed for the first quarter of twenty twenty-seven. The corporate loyalty identifier is second quarter. International sales are third quarter. The launch list does include voluntary changes on wholly unused tickets, and the report does not say whether that covers a private fare booking. It also does not say what happens to a ticket that is partly flown. Those are gaps in the list as reported. They are not statements from Delta.

Eric Marketts

Which brings us to our own question. In Episode 21, I said that if Delta has built servicing parity into launch, instead of shipping shopping and promising to fix servicing in phase two, that would be the two years made concrete. The answer is somewhere in between. Delta plans to launch the shopping and part of the servicing, and has put parts of corporate servicing, such as private fare changes, in the first quarter of twenty twenty-seven and after. That is our reading of a list, not Delta's claim. Here is why it matters. A travel management company, the firm that runs a corporate client's travel program, has to be able to change a booking without calling anyone. If it cannot change a private fare booking in the new channel, it books that traveler in the old channel. In August, Delta said it will support multiple connection methods to meet customers in their channel of choice. My bet is that corporate agencies will choose the channel where the service department is open. So watch the first quarter. If private fare changes arrive on schedule, the launch has a corporate story. If they slip, Delta will have a lane with the corporate traffic still parked somewhere else.

Steph Nell

Narrative two is about a problem every corporate traveler has met and airlines rarely see. Waiting for a yes. Eric, why does a price need a clock?

Eric Marketts

Because fares move. When an agent shops a flight, the airline quotes a price. If the agent pauses before ticketing, the airline can change that price in the meantime. Think of a hotel that quotes you a room rate and says it holds until noon. After noon, the rate is whatever it is. Corporate travel adds a wrinkle. In many companies a trip needs approval before anyone books it. The traveler asks, a manager signs off, sometimes a travel manager checks policy. That can take longer than the quote lasts. The industry's term for the hold is the price guarantee time limit.

Steph Nell

So if the quote runs out while the boss is deciding, what happens?

Eric Marketts

Without a hold, the fare can change while the approval is pending. That is the risk Lufthansa Group's own factsheet says it is removing.

Steph Nell

Lufthansa Group has introduced a twenty-four hour price hold for bookings made through its NDC channels, aimed at travel agencies and management companies serving corporate clients. The hold runs up to twenty-four hours after the order is created. The booking has to carry a valid Corporate Location Identifier, an ID the airline requires on the order. The hold also covers prices from Lufthansa's Continuous Pricing, which sets fares at many more points than the old fare buckets. Lufthansa lists exclusions. Travel to and from Japan. Departures from China. And Economy Basic fares on European routes. The factsheet says the offer runs from September twenty twenty-six to January twenty twenty-seven. Trade outlets, which reported it on September fourteenth, give October first to January eighteenth.

Eric Marketts

One note on sourcing. Those terms come from a one-page Lufthansa Group factsheet, and the dates and reasoning are confirmed by trade outlets in English, German and Italian. The factsheet says the point is to give travelers and travel managers time to finish internal approvals without the risk of a fare change. Trade coverage adds that Lufthansa describes the trial as a way to show NDC can support the whole corporate booking workflow, not just access to its fares and offers.

Steph Nell

So what is the bull case?

Eric Marketts

It fixes a real corporate pain with a concrete number. Twenty-four hours gives an approval a full day to finish. The agency adds the identifier when it creates the order, and the quote holds. And look at what kind of announcement this is. It is an airline changing a rule to fit how corporate buyers actually work, not announcing another connection.

Steph Nell

And the bear case?

Eric Marketts

It is a trial with an end date, a few months, not a policy. Twenty-four hours will not cover an approval that takes two days. The exclusions are real. And it applies only to bookings made through Lufthansa's NDC channels, so our read is that it is also a reason to use those channels. Lufthansa has said about half of its agency sales now run through NDC, but we found no corporate-only figure, and nothing on what happens when the hold lapses. Here is the critical take. Put Lufthansa next to Delta. Delta published a calendar for servicing. Lufthansa published a clock for approvals. Two airlines, two different problems, one message. Corporate travel needs more than a shopping response, and the airline now says so with a date on it. That is our reading, and the evidence is two announcements, not a trend. The counterpoint is incentive. A hold that works only in the airline's own channel is also a way to pull corporate bookings into it, and a trial can be withdrawn. So read both as offers, not proof. The proof is whether corporate agencies use them, and neither airline has published that number.

Steph Nell

Narrative three. Same technology, both sides of the sale. Two terms first. Agentic AI means AI assistants that search and book on a traveler's behalf. Look-to-book is how many searches happen for every booking. Every search costs someone money to answer. In Episode 23, last week, we covered Sabre's AI agent layer, where it named nearly eighty customers and no price, and a conference panel where Infosys talked about AI traffic costs.

Eric Marketts

Start with how the money flows, because it explains the whole narrative. A GDS earns its fee when a booking happens. Amadeus and Sabre alone reported about five point seven billion dollars of distribution revenue last year, much of it booking fees paid by airlines, and Travelport does not publish a comparable figure. A search that never becomes a booking earns no booking fee. We found no public per-search charge, though airlines can penalize ratios they consider too high. That arrangement assumes searches stay roughly in proportion to bookings.

Steph Nell

Here is a way to picture it. Think of a store with a returns desk and a floor staff. The returns desk handles exchanges and refunds, which is repetitive, rule-bound work. The floor staff fetch items for browsers all day, whether or not anyone buys. Now give the store software that handles returns, and give every shopper an assistant that asks the floor staff for fifty items before choosing one. The returns desk gets cheaper. The floor gets busier. Those are two different budgets, and they may belong to two different companies. That is this narrative.

Eric Marketts

This week, two pieces from Skift. On September nineteenth, Skift previewed a session by Steve Singh, the chief executive of Spotnana, a managed travel platform. Singh said, quote, I believe we can reduce servicing costs by fifty percent or more while making traveler experiences dramatically better through servicing that is much more personalized and proactive. The piece says Spotnana now has AI agents handling cancelled segments, unticketed flights, and refunds. And Skift added a caveat. The test, it wrote, is whether a fifty percent reduction holds outside a managed travel platform built for it.

Steph Nell

Four days later, on September twenty-third, Skift ran a piece headlined, Agentic AI Is Raising Travel's Tech Bill, from a Skift Global Forum session where executives from Amadeus and Spotnana appeared together. Skift's summary line is that the two agree the plumbing for AI-powered travel costs more now. It quotes Elena Avila, executive vice president of travel distribution at Amadeus. Quote, I think we shouldn't just be complacent and think that revenue will simply come. Skift reports she said the bills for compute power, heavier search traffic, and the governance, security and data plumbing are arriving now, while the revenue is not guaranteed to follow. Skift reports that Amadeus chief executive Luis Maroto warned in July that AI could push look-to-book ratios higher, which means more searches for every booking. And Skift's own line, quote, the industry still hasn't settled who pays, or who captures the value.

Eric Marketts

The bull case.

Steph Nell

Both can be right. Cancelled segments, unticketed flights and refunds are repetitive, rule-bound work, which makes them a natural place to automate. If half of a servicing cost can be removed, that shows up on a profit and loss statement. And an Amadeus executive saying the shopping cost out loud is the first step toward pricing it.

Eric Marketts

And the bear case.

Steph Nell

The fifty percent is Singh's belief, in his own words, and Skift's own caveat is whether it holds outside the platform built for it. On the other side, Skift's piece, as far as we can find, cites no figure for the shopping cost and no price that recovers it. Avila's words are a warning, not a plan.

Eric Marketts

Here is the question a listener should ask. If the companies paying for the searches are the ones losing money on them, why not charge for the search?

Steph Nell

Because nobody has published a price. Since Episode 8, our standing watch item has been the first carrier to publish terms for AI agents. How an agent identifies itself, how many requests it gets, and what a query costs. We searched again this week and found no airline or GDS that has. Lufthansa Group's NDC terms, in the version we found, do cover shopping costs up to a look-to-book ratio of five hundred to one, and reserve the right to cut off access above it. That is a cap on searching, not a price for an AI agent. Without that price, the saving sits on one side of the ledger and the cost on the other, and nothing in these two pieces connects them.

Eric Marketts

Both executives agree on the cost. They differ on the saving. Only Singh claims one. Put the two sides together and ask who holds each. The saving Singh describes is labor, the people who handle changes and refunds. That sits with the company that employs them, which is a travel seller. The cost Avila describes is machines answering more searches. That sits with whoever runs the shopping infrastructure, the GDS and the airline. Same technology, different companies. That is our inference from two articles, not a statement from either executive. And the obvious objection is that a cost the GDS absorbs today gets passed down in booking fees tomorrow, to the same sellers. Neither piece says how that settles. So read it against the first two narratives. Servicing is where AI is claimed to pay for itself. Shopping is where it is known to cost. The only claimed saving in these pieces is a servicing number from one vendor. And Delta's calendar tells us the service department is still being built.

Steph Nell

Three narratives, one question. Who does the work around the sale, and who pays? Delta answered with a calendar for servicing, and the corporate pieces come last. Lufthansa answered with a clock for corporate approvals, as a trial. And two AI executives agree the plumbing costs more now, while one of them claims servicing savings of half, and who pays for the rest is unsettled.

Eric Marketts

Three things to watch. First, whether Delta's year-end launch lands on schedule, and whether private fare changes still show up in the first quarter. Second, whether Lufthansa extends the twenty-four hour hold past January eighteenth, and whether any other airline copies it. Third, whether any carrier publishes a price for an AI agent's search, and whether anyone shows a servicing saving like Singh's outside a platform built for it.

Steph Nell

If you have a view on any of this, send it our way. We read everything. And if this was useful, share it with someone deciding distribution or servicing strategy.

Eric Marketts

We'll be back next Monday. I'm Eric Marketts.

Steph Nell

I'm Steph Nell. Thanks for listening.

Eric Marketts

Stay sharp out there.