Pirate Travel Agencies Thrive in Mexico

The surfacing of at least 300 pirate travel agencies in Mexico is putting just another spoke in local tour operators’ wheel that have already seen their gains dwindle following airlines’ decision to cut down on ticket sale commissions from 10 to 1 percent.

Jorge Hernandez Delgado, chairman of the Travel Agencies Association of Mexico (AMAV is the acronym in Spanish), explained the phenomenon began last year and has since then hit over 2,700 travel agencies that operate in the country on a regular basis.

Mr. Delgado said that each official travel agency creates half a dozen jobs, but the emergence of those gypsy tour companies has thwarted the creation of at least 1,500 new positions in the industry.

Back in 1998, there were around 4,200 travel agencies in the country. But as soon as airlines decided to slash commissions, the number has shrunk to less than 1,500 agencies and more than 9,000 employees have been laid off.

Industry entrepreneurs have asked Mexican President Vicente Fox to help them negotiate a better plan with airlines (a 10 percent commissions for ever plane ticket sold by national companies and 9 percent for international agencies). The administration hasn’t yet responded to this request.