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As U.S. airlines seek to cull every last cost from their operations, travel agents are gearing up for what one agent calls a "battle royal" over a recent decision by United Airlines (UAUA) to pass along credit-card processing fees to 28 travel agencies. Those costs, which amount to 2% to 3% of the price of an airline ticket on average, are currently paid by airlines as part of the ticketing process. Wall Street is eager to assess whether United's move will prove successful, given that shifting such costs to agents and fliers could represent billions in savings across the industry.

Agents argue that United's card-fee experiment makes no logical sense because such a small agency group will not yield much in cost savings for such a large carrier. Instead, some agents contend the airline is hoping to spark an industry-wide assault on distribution costs, with travel agents' card fees merely the first front.

In a July 17 letter responding to 13 members of the U.S. House of Representatives who expressed concern about the matter, United says its change is limited and "in no way was intended to be a broad move in the marketplace, as has been interpreted by outside organizations." The Chicago airline also agreed to offer a 60-day extension on the fees to agencies that request one. Senators Ron Wyden [D-Ore.] and Jeff Merkley [D-Ore.] also wrote to United CEO Glenn Tilton in the past week, urging him to delay the program.

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