Published On: Tue, Apr 3rd, 2018

Travel Industry Reacts to ALG and Mark Travel Merger

Apple Leisure Group (ALG) and the Mark Travel Corporation entered into a definitive agreement to join forces.

The move, announced April 2, generated a lot of feedback from industry leaders who are curious to see what the resulting new company will look like.

Much of the response was highly positive as the industry waits to see what emerges after the deal closes.

Travel Leaders’ Pam Young, senior vice president-industry relations noted that the group does business with many of the brands involved and it looks forward to the increased opportunities the merger may offer.

“Since travel agents sell the majority of volume for both of these brands, we believe that the retail travel distribution channel will be more important to them than ever,” said Young. “If this merger results in broader product offerings and other efficiencies, it will be a good result for the agency community. In general, travel agents are loyal to a particular tour operator. If the merging of these brands brings about more content in their product offerings, that is good for travel agents.”

Avoya Travel has also concluded that the joining of the two companies will result in a beneficial new relationship.

“It’s too early to tell how the merger will directly impact Avoya’s business, if at all, however, we feel very positive about the deal as they are both exceptional companies that we have strong relationships with,” Ashely Hunter, Avoya Travel’s vice president of sales development.

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Chad Burt, co-owner and co-founder of OutsideAgents.com said that they are in a wait-and-see mode.

“Both companies have been great partners of ours for years,” said Burt. “We don’t expect any major changes. We imagine the merger will improve their buying power through increased market share. That’s good for everyone.”

Jennifer Doncsecz, president of VIP Vacations Inc., in Bethlehem, Pennsylvania, sees the move as positive, but does question some of the results the merger could bring.

“This merger is very strategic and gives ALG command of almost all of the ‘charter’ markets in the U.S. to the Caribbean and Mexico. (The only outlier is Vacation Express, which operates a few Sunwing charters in some markets),” said Doncsecz. “This also opens up the door for Mark Travel, and the brands it manages, to now sell AMResorts, which is truly beneficial to ALG.

“The technology that Mark Travel brings to ALG with its Trisept Solutions is also very powerful and can aid ALG as technology was never in the forefront or part of its portfolio,” she added.

However, Doncsecz did wonder what the market will look like to competitive brands of ALG.

“I am sure agents are curious if Mark Travel will still carry brands like Sandals/Beaches, Hyatt Ziva/Zilara and Excellence since those brands pulled their allotments from ALG,” she said. “I am one that believes that more booking channels result in more choices as well as competitive pricing, which is beneficial for travel agents and for our consumers. With this merger, there is one less channel out there. Added to this, if there are service issues, agents have fewer options.”

Judy Nidetz of Travel Experts in suburban Chicago also brought up concerns about a contracting market.

“I think this is terrible news,” said Nidetz. “Less competition in the markets results in higher prices and fewer options for consumers.”

“I use each of these companies quite a bit because they offer nonstop charter air to resort destinations in Mexico and the Dominican Republic. In the past, I have always been able to research pricing and specials offered by each company individually and in return offer the best pricing options to my clients,” added Nidetz.

“Now, it will be interesting to see if the companies will remain independent or if they will combine and offer rate parity between markets,” she said. “While I understand their thinking is that they have strength in numbers in order to compete with the big box online agencies, I still believe this will be harmful to consumers and, in the end to travel agents.”

It is too early to tell what will happen once the companies merge. The deal will be final in the second quarter of 2018.

Theresa Norton, Harvey Chipkin, and Lydia Gregory contributed to this report.

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