Amex GBT Responds to ‘Politically Motivated’ Justice Department Antitrust Lawsuit

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American Express Global Business Travel has criticized the U.S. Department of Justice’s antitrust lawsuit looking for to block the CWT acquisition as “a blatant politicized effort to mount a final challenge to a corporate merger” at the top of the Biden administration.

In a response filed Tuesday to the Justice Department’s criticism filed last week, Amex GBT described the Justice Department’s findings as a “hasty, apparently politically motivated complaint,” on condition that the acquisition was scheduled to be accomplished in March, when the Trump administration could be in charge. It also said the criticism “presents a wholly inaccurate picture of the current industry, using cherry-picked facts, isolated examples and outdated, out-of-context statements that do not reflect today’s competitive landscape.”

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Politics aside, listed here are a number of the key allegations made by the Department of Justice in its criticism and Amex GBT’s response to each of them. The $570 million takeover also faces a challenge from the UK Competition and Markets Authority, with a final decision expected inside the following two weeks.

Global/international customer market

Department of Justice Claim: Similar to the findings of the UK CMA in its opposition to the takeover, the Department of Justice considers that the sphere of TMCs able to compete for global and international customers is principally limited to Amex GBT, CWT and BCD Travel, while other TMCs don’t currently have such scale to serve such clients. “In the global and international segment, agent performance requirements are even more severe because many global and international customers require their own designated agents assigned only to their account,” according to the criticism. “Even when it comes to acquisitions… other travel management companies have few options that would enable them to replicate the size and scale of Amex GBT, CWT and BCD Travel.”

Amex GBT Response: Amex GBT said the Justice Department’s criticism “distorts an artificial marketplace” of worldwide multinational firms by “failing to demonstrate that these customers receive unique products or services or even have similar purchasing patterns or requirements.” It further claims that “several other TMCs” are competing for big customers as well as to CWT and BCD, including FCM, Navan, Kayak for Business, Spotnana and Direct Travel, “most of which Amex GBT rate data shows winning higher value deals in actual new customer contracts with Amex GBT than CWT,” according to the response. “Independent research data also shows that at least six TMCs meet the requirements of large customers as often as CWTs.”

Technology selection

Department of Justice Claim: The criticism stated that eliminating CWT’s product from the market would “deprive customers of an important choice” and cited anonymous customers who switched from Amex GBT to CWT and were unhappy with the acquisition. “If the transaction is completed, Amex GBT clearly intends to eliminate CWT technology and force customers to migrate to its own products, which Amex GBT described as “taking it to the next level.” [Amex] GBT Platform” and “Forced March to [Amex] GBT Tech Stack,” according to the criticism.

Amex GBT Response: Amex GBT said that while it has made significant investments in its own platform, it should proceed to support third-party technologies to ensure customers proceed to have alternative in technology solutions. “Amex GBT would plan to migrate CWT customers to its own platform (i.e. infrastructure, telephony, cybersecurity capabilities, etc.) in order to ensure these customers benefit from Amex GBT’s extensive investments, while continuing to provide them with the choice of tools that Amex GBT does today ” – follows from the response. “In fact, 40 percent of today’s Amex GBT transactions are conducted through third-party technologies, making it a critical channel that all CWT customers would benefit from.”

Adoption of the NDC

Department of Justice Claim: As an example of how the acquisition would “slow innovation,” the DOJ cited that Amex GBT “has repeatedly dragged its feet in adopting standards for new distribution capabilities” compared to CWT, which has “supported the incorporation of NDC content” partially through its Spotna Collaboration app. As evidence, the criticism cited a June 2023 email written by Amex GBT CEO Paul Abbott by which he stated that Amex GBT should “do enough to appear progressive… but also use these pilot programs to highlight gaps and block further action until a scalable model is achieved.” “

Amex GBT Response: Amex GBT said it had made “extensive efforts” to bring in regards to the adoption of the NDC, as a part of the NDC program, which currently covers 16 countries and 20 airlines. “In fact, Amex GBT met and exceeded American Airlines’ mandate of 30 percent of transactions through NDC through its own channels by April 21, 2024, achieving nearly 50 percent of American Airlines transactions through NDC,” according to the discharge. from the reply. . “Amex GBT believes it is one of the few TMCs to achieve this goal at scale, demonstrating its commitment to NDC and innovation leadership with customers, suppliers and technology partners.” (The American subsequently revoked the mandate.)

Supplier Fees

Department of Justice Claim: The criticism states that “airlines, hotels and other travel service providers may be harmed” by the capture of increased commissions and charges. “During negotiations, CWT’s owners estimated that the transaction would potentially allow Amex GBT to charge travel service providers more than $100 million in increased commissions and fees and urged Amex GBT to enhance its offer to CWT to reflect this additional revenue.” the criticism reads within the report. The Justice Department added that Amex GBT managed to renegotiate higher fees following its acquisition of Egencia.

Amex GBT Response: Amex GBT said the estimate reflected “ineffective negotiation tactics by CWT’s owners in negotiating the proposed transaction. When pricing CWT, Amex GBT never guaranteed any supplier harmonization synergies.” Amex GBT also denied the Justice Department’s findings of upper fees resulting from the Egencia acquisition.

Rome
Romehttps://globalcmd.com/
Rome: Visionary Founder of the GlobalCommand Ecosystem (GlobalCmd.com | GLCND.com | GlobalCmd A.I.) Rome is the innovative mind behind the GlobalCommand Ecosystem, a dynamic suite of platforms designed to revolutionize productivity for entrepreneurs, freelancers, small business owners, and forward-thinking individuals. Through his visionary leadership, Rome has developed tools and content that eliminate complexity, empower decision-making, and accelerate success. The Powerhouse of Productivity: GlobalCmd.com At the heart of Rome’s vision is GlobalCmd.com, an intuitive AI-powered platform designed to simplify decision-making and streamline workflows. Whether you’re solving complex business challenges, scaling a new idea, or optimizing daily operations, GlobalCmd.com transforms inputs into actionable, results-driven solutions. Rome’s approach is straightforward yet transformative: provide users with tools that deliver clarity, save time, and empower them to focus on growth and achievement. With GlobalCmd.com, users no longer have to navigate overwhelming tools or inefficient processes—Rome has redefined productivity for real-world needs. An Ecosystem Built for Excellence Rome’s vision extends far beyond productivity tools. The GlobalCommand Ecosystem includes platforms that address every step of the user’s journey: • GLCND.com: A professional blog and content hub offering expert insights and actionable advice across business, science, health, and more. GLCND.com inspires users to explore new ideas, sharpen their skills, and stay ahead in their fields. • GlobalCmd A.I.: The innovative AI engine powering GlobalCmd.com, designed to turn user inputs into tailored recommendations, predictive insights, and actionable strategies. Built on the cutting-edge RAD² Framework, this AI simplifies even the most complex decisions with precision and ease. The Why Behind GlobalCmd.com Rome understands the pressure and challenges of running a business, launching projects, and making impactful decisions in real time. His mission was to create a platform that eliminates unnecessary complexity and provides clear, practical solutions for users. Whether users are tackling new ventures, refining operations, or handling day-to-day decisions, Rome has designed the GlobalCommand Ecosystem to meet real-world needs with innovative, results-oriented tools. Empowering Success Through Simplicity Rome’s ultimate goal is to empower individuals with the right tools, insights, and strategies to take control of their work and achieve success. By combining the strengths of GlobalCmd.com, GLCND.com, and GlobalCmd A.I., Rome has created an ecosystem that transforms how people work, think, and grow. Start your journey to smarter decisions and greater success today. Visit GlobalCmd.com and take control of your future.

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