Navan Analysis Highlights NDC Savings Over EDIFACT

New Distribution Capability bookings through Navan are bringing clients savings as high as 16.6 percent per airline, accounting for global distribution system surcharges and a broader access to fares and price points, according to the company's analysis of NDC activity earlier this year.

For the analysis, Navan, the former TripActions, looked at NDC bookings with 12 airlines over a three-month period, from mid-February through mid-May. In May, NDC bookings accounted for about 24 percent of all flights booked on the Navan platform in the U.S. and 31 percent of flights in Europe, according to the analysis. On a country basis, Germany had the highest percent of NDC bookings at 45 percent, due to activity on Lufthansa Group carriers and KLM.

On a carrier basis, three Lufthansa Group carriers—Brussels Airlines, Lufthansa and Austrian Airlines—had the highest NDC utilization on Navan as they provide "highly differentiated content" via NDC, according to Navan. They were followed by Finnair, where domestic fares have been removed from legacy channels.

Finnair also had the highest savings on its NDC fares, with available NDC fares 16.6 percent lower than the equivalent lowest fare on EDIFACT. Singapore Airlines was next, with a 14.8 percent differential, followed by American Airlines (11.5 percent) and Lufthansa Group carriers (10.7 percent). The lowest differential was on United Airlines, where NDC fares averaged 3.3 percent lower than the equivalent lowest EDIFACT fare, according to Navan. The report clarified that savings vary by customer depending on how much they use the carrier as well as other factors, such as flight spend.

Navan Travel CEO Rich Liu, who rejoined the company earlier this year, in a statement said the analysis is "illustrating the potential savings and traveler value of NDC done right."

Those savings come from a mix of avoiding surcharges and wider fare availability. While travel management companies can avoid some carrier surcharges, some carriers—including Finnair, Lufthansa Group carriers, Emirates and Singapore Airlines—apply them to all GDS bookings.

American Airlines does not surcharge for GDS bookings, but its removal of about 40 percent of its fares from EDIFACT channels—since reversed, but in effect at the time of Navan's analysis—left more price points and fare available exclusively in NDC channels. In Navan's analysis period, that translated to 12.4 percent cheaper fares available in Economy class, 4.2 percent cheaper for Business and 18.5 percent cheaper for First.

"Although the airline has said it is assessing its strategy, users with access to AA NDC are still currently benefitting from additional and lower-priced fares," according to Navan.

Navan highlighted savings for some specific clients in the report. Michael Spiga, director of business services for roofing and waterproofing manufacturer GAF, projected NDC would bring his program annualized savings of $330,000.

"Our teams usually travel within the U.S. or Europe to visit our plant locations, meet customers and attend events," Spiga said in a statement. "Since integrating with the United direct connection earlier this year and AA last year, we've seen massive savings."