Almost seven months since the proposed acquisition was first announced, a major lobbying group has come out against Expedia-Orbitz deal.
The American Hotel and Lodging Association says it registering its opposition to the $1.6 billion deal by Expedia to get its hands on rival online travel agency Orbitz, an acquisition currently being reviewed by the US Department of Justice.
The organisation, which claims it is the only body representing a 1.8 million person industry, says the deal will “result in significant negative consequences, particularly for consumers, but also for the large number of our members who are small business owners and franchised properties”.
Expedia would control 75% of the OTA marketplace if the deal is given the thumbs-up by regulators, argues president and CEO of AH&LA, Katherine Lugar, adding that the addition of Orbitz to the portfolio would be detrimental for a number of reasons.
Lugar says, from a marketing perspective, an approved deal would reduce the number of OTAs that hotels can work with on “innovative promotional efforts that benefit consumers”. The organisation also claims Orbitz could raise its commission rates to those of the mothership, currently sitting at an estimated 11% difference between the two brands.
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