The Philippine Travel Agencies Association (PTAA) Tuesday warned that 2010 might become a financial struggle to travel agencies with airlines evolving their business models to cut travel agencies from the process.

PTAA president Ma. Paz Alberto said the continued threat of airline web fares could lead travel agencies to drastically scale down operations.

“There could be a lot of downsizing as we continue to find some airlines encroaching on our businesses. It is a distressing development when airlines, whom we have considered as our partners, undercut travel agencies,” Alberto said.

Still, Alberto believes the window is still open for airlines and travel agencies to thresh their differences especially after it reached an agreement with Philippine Airlines on its web fare promos.

“We already have a working arrangement with Philippine Airlines where they promised they will no longer have any promo fares that rae lower than what travel agencies offer," Alberto said.

During the first half of the year, the PTAA and the national carrier went head on as the latter drastically lowered its aitfares to destinations that compromise 60 percent of the travel agencies businesses during the peak season.

Alberto said tha PTAA will also be holding informal talks with cebu Pacific (CEB), the other domestic carrier that has been very aggressive with its web fare promos.

"We will ber having talks with some of their officials and try to find a common ground or a working arrangement that will benefit both sides," Alberto said.

According to Alberto, PAL already showed the way when the national carrier realized the importance of travel agencies to their operations and is hoping that CEB will also do the same.