Northwest's Net move hits more turbulence

Galileo International is cutting privileges for Northwest Airlines on its travel reservation system, after the airline said it would put an extra charge on bookings made outside its Web site.

The company said Thursday that Northwest's decision this week to charge travel agents additional fees when they use a global distribution system like Galileo's violates a Preferred Fares Select agreement between the two companies.

As a result, Galileo will no longer provide Northwest with benefits granted under that contract, the company said. Those benefits included prominent display of Northwest ticket prices to Galileo's travel agent partners, access to discounted-fare shoppers and other distribution discounts.

Galileo, a subsidiary of Cendant, follows rival Sabre Holdings, parent of Travelocity.com, in pulling services in response to Northwest's move, with which it aims to drum up online ticket sales and cut $70 million from its distribution budget. The airline on Tuesday unveiled plans to begin charging travel agencies an extra $7.50 for round-trip U.S. domestic tickets booked through the global distribution systems.

Northwest, based in Eagan, Minn., also said it will begin charging customers an additional $5 for domestic tickets purchased over the telephone and a $10 surcharge for tickets bought at airports.

Ken Esterow, executive vice president at Cendant Travel Distribution Services, said in a statement that the company is "disappointed" with Northwest's decision and accused the airline of misleading Galileo when it signed its pricing agreement with the company only last year.

On Wednesday, Northwest filed a lawsuit against Sabre, saying the reservation specialist violated a deal by changing the way it lists the airline's prices and other measures adopted after Northwest made its move. Sabre has pledged to take away Northwest's preferred-ticket listing status and discounts on booking fees.

Northwest representatives declined to comment on the Galileo announcement.