TUI Carnival Joint Venture in Play

This is a follow-up to a story earlier this week. This story is from Travelmole.com
written by Phil Davies.

TUI in Carnival joint venture - 65 new aircraft ordered
TUI is to create a joint venture with Carnival Corporation to enter the high volume pemium cruise segment.

The German travel giant, which has announced 2,600 UK job cuts today, is also creating a new Europe-wide internet portal for flights.

A new brand - TUIfly.com - will cover the company's German flight business though the merger of Hapagfly and Hapag-Lloyd Express to give a fleet of 56 aircraft next year.

It has ordered an additional 65 Boeings worth two billion euros for delivery from 2010 to replace leased aircraft currently oeprated in all source markets.

TUI is to acquire up to 25% in a joint venture with Carnival to tap into the German cruise market. The group is currently represented in the luxury segment by Hapag-Lloyd Kreuzfahrten and operates the budget Thomson Cruises brand in the UK.

"We are now planning to close a gap in the high-volume premium sector with TUI Cruises," said CEO Michael Frenzel.

Carnival's German cruise arm AIDA will be brought into the joint company and a separate TUI Cruises brand will be established with the first 3,000-passenger ship to be delivered in 2010.

Meanwhile, TUI signalled an ambition to grow its online business to account for more than a quarter of total turnover - up from 18% - within the next three years.

At the same time, Frenzel stressed that travel agencies will remain a key distribution channel in Germany.

"We are pursuing a clear objective - on an average we are planning to grow 50% inthe internet segment in the respective source markets wthin the next three years," said Frenzel.

Carnival confirms TUI talks

As reported by E-tid.com

Carnival has confirmed that is in talks with TUI AG, although it has not specified what is under discussion.
Carnival did say that ‘the nature of the discussions has been incorrectly reported by various German media as they do not involve exclusive distribution of any of Carnival's cruise products.’
It said that its AIDA brand, which serves the German market, ‘is completely satisfied with its present distribution model and appreciates the support that it receives from its travel agent partners’.
The statement ends with the corporate caveat: 'Should current discussions lead to an agreement with TUI AG, Carnival Corporation & plc will immediately announce details of the agreement. However, until that time, the company will not comment further.'

Further Consolidation on the GDS Front?

The Wall Street Journal and the the NY Times both stated that Sabre was on the auction block today. One of the reports states a deal could be consummated as earlier as Tuesday, while the other states as early as this week. From comparing the two reports and checking with others in the industry, it appears that there are three principal auctioning parties. Reports say the company is in advanced talks to be sold to a consortium of private equity firms for more than $4 billion. The New York Times reports that there are two investor groups vying for Sabre and that the group favoured to win comprises Silver Lake Partners and Texas Pacific Group. The other group is led by Apollo Group and there could be a third group waiting in the wings. Private equity groups like the reservation business because of its steady cash flow and some of the members of these groups bid unsuccessfully for Travelport. Sabre was spun off from AMR Corp, the parent of American Airlines in 2000 and owns Travelocity, one of the 3 biggest OTA's.

Worldspan Travelport Merger

What does this mean for WSPAN customers? A cumbersome migration to Galileo? What is Travelport buying, the declining customer segment count, the e-commerce search capabilities? Was Travelport the only one willing to throw a life-ring to this dwindling player? Others certainly have the means. The competition is probably pleased with this announcement. With only 3 strong players left in the North American GDS markeplace it adds yet another wrinkle to the distribution game. This was not a unforseen occurrence as Expedia was bailing, PCLN in Europe. I am curious if the airlines and Worldspan factored this in their negotiations with all the GDSs earlier this year ?