Airlines Must Ask For Volunteers First, Pay Those Unwillingly Bumped
July 29, 2009
DALLAS -- Airlines are operating fewer flights this summer, meaning that planes are packed even with the slump in travel.
Often the airlines sell more tickets than there are seats on the plane. Last year, more than 63,000 passengers were bumped, according to government figures, and this year is shaping up as more of the same.
So what should you do if you get bumped? What if your flight is delayed so long that you miss your niece's wedding?
Before bargaining with the gate agent over travel vouchers and upgrades, it pays to know your rights and the airline's responsibilities.
The federal government sets rules on bumping and occasionally fines airlines for breaking them. This month, the Transportation Department fined Delta Air Lines $375,000, although it may waive about half if Delta improves its procedures for handling oversold flights.
Airlines must ask for volunteers first, and pay passengers who are bumped against their will.
If you are bumped from a domestic flight, the airline must pay you the price of a one-way ticket up to $400 cash if you are rescheduled to reach your destination between one and two hours of the original arrival time. The maximum doubles to $800 if it takes longer.
Some passengers with time to kill don't mind getting bumped. They hope to get cash, travel vouchers or an upgrade to first-class in exchange for taking a slightly later flight.
Chris McGinnis, a travel consultant in San Francisco, says the best flights to haggle over are late-afternoon or evening ones popular with business travelers who can't afford to be stranded overnight. Airlines are likely to offer more for passengers who give up a seat on a New York-Chicago run than on a flight full of vacationers from Atlanta to Orlando, he says.
Gate agents may put out a sign or simply tell passengers that they're looking for volunteers to skip the flight. McGinnis says it's often best to ignore their first offer and wait until departure time nears.
"The bidding gets stronger," he says. "That's when it goes from $100 off your next flight to maybe $300 and a business-class seat on the next flight out."
Experts warn about accepting travel vouchers. They might be hard to redeem, especially at peak travel periods. Make sure you understand any limitations.
Travelers are often baffled why airlines can sell more tickets than they have seats. Airlines oversell flights because some passengers buy costly fully refundable tickets on more than one flight and then only use one. Other flights are overbooked because the airline had to substitute a smaller plane with fewer seats.
While there are federal rules on bumping, there is no sweeping requirement for airlines to provide hotel rooms and meals for passengers who are stranded overnight, even if it's the carrier's fault, according to the Transportation Department. But you can haggle.
"It's up to the discretion of the carrier and the (gate) agent," says George Hobica, who operates airfarewatchdog.com. "Some airlines will do their best if you ask nicely and you ask privately you'll do better than if you make a scene." He says when a long delay appears obvious, you should ask to be rebooked on another airline.
Charlotte, N.C., real estate broker Mathew Bessette says Delta put him up in a hotel after his flight home from New York was canceled and a second flight spent four hours on the tarmac. He says he gained bargaining power by knowing the cause of the problem with his first flight no flight attendants.
"If their plane breaks down or their crew doesn't show up, that's their problem and it's their responsibility to accommodate you within reason," he says.
Veteran travelers say if a long delay will cause you to miss the reason for your trip a wedding or business meeting, for example ask for a refund. However, there is no law requiring the airline to give you a refund.
Airlines and passenger-rights groups are fighting over how the carriers handle long delays, and Congress may settle the issue. This month, a Senate committee passed a bill that would require airlines to let passengers off planes that are stuck on the tarmac for three hours.
The airlines say such a law would make things worse by forcing planes that might be near the front of the takeoff line to taxi back to the gate, then go to the back of the pack. More flights would be canceled, says David Castelveter, spokesman for the Air Transport Association, a Washington trade group for the largest U.S. carriers. Consumer groups aren't buying it.
"No one believes that the airlines will fix the problem themselves," says Kate Hanni, a California real estate agent who created a passenger-rights group after being stranded on a grounded American Airlines jet for more than eight hours in December 2006. "They haven't yet."
Since airline travel is often stressful, and summer always brings many delays, experts advise you have a Plan B. Know what flights are available if yours is canceled. If your flight is pushed back or scrubbed, hop on your laptop or phone to see if you can rebook.
"Prepare for the worst," says Hobica, the travel expert. "Bring a good book."
Copyright 2009 by The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Thursday, July 30, 2009
Tuesday, July 28, 2009
Three-hours-on-the-tarmac legislation finally taking off - Letters to the Editor - The Hill
The Senate Commerce Committee last week approved the FAA reauthorization bill containing the bipartisan Boxer-Snowe Airline Passengers Bill of Rights which, among other protections, allows passengers the option to return to the terminal after sitting on the tarmac for three hours.
As one who was locked inside a sealed aircraft for nine hours in 2006, I know this legislation is long overdue. With no food, no water and overflowing toilets, it was a dreadful experience — and no way for the airline to treat its customers.
The airlines’ reaction?
Air Transport Association spokesman David Castelveter has called the three-hour limit “a hard-and-fast inflexible timeframe” that will result in “more cancellations and inconvenience.”
Since when do the lobbyists for commercial airlines care about passenger inconvenience?
“More” cancellations? As one who’s been through it, I can assure you that after nine hours on the tarmac, most of us could care less if our flight counted against cancellation statistics — nor were we in any mood to remain seated for the flight to our destination. Most of us just wanted to go back into the terminal so we could relieve ourselves, eat and book hotel rooms.
In any event, a September 2008 DOT Regulatory Impact Analysis concluded that, far from increasing cancellations, airlines’ awareness of deplaning costs for delayed flights could instead result in better flight management and improved operations overall.
As for the notion that three hours is a “hard-and-fast inflexible timeframe,” I’ll resist the easy temptation to challenge Mr. Castelveter to sit that long in the middle seat in coach without drinkable water or usable toilets.
The fact is, this bipartisan legislation gives maximum flexibility to airports and the airlines alike: Passengers will only be permitted to deplane if it can be done safely, and pilots may extend the time for 30 minutes if there’s a likelihood of immediate departure. Passengers may even choose to remain onboard — but if they do, they’ll be given the chance to change their minds every three hours.
ATA’s Castelveter has also claimed “great progress in reducing lengthy tarmac delays and improving service while on board as reflected in Transportation Department statistics.”
The operative words are “as reflected in Transportation Department statistics.” Those numbers don’t include the 1 million international flights originating in or departing from the U.S. each year, nor any of the smaller carriers that account for one domestic flight out of every four.
Yet setting aside all the flights the DOT excludes, passengers were still stranded on the tarmac for more than three hours on 1,232 flights in 2008 alone. That may represent progress to the airlines, but to their customers, it proves the need for an enforceable time limit.
Kate Hanni
Napa, Calif.
Full story: http://thehill.com/letters/three-hours-on-the-tarmac-legislation-finally-taking-off-2009-07-27.html
As one who was locked inside a sealed aircraft for nine hours in 2006, I know this legislation is long overdue. With no food, no water and overflowing toilets, it was a dreadful experience — and no way for the airline to treat its customers.
The airlines’ reaction?
Air Transport Association spokesman David Castelveter has called the three-hour limit “a hard-and-fast inflexible timeframe” that will result in “more cancellations and inconvenience.”
Since when do the lobbyists for commercial airlines care about passenger inconvenience?
“More” cancellations? As one who’s been through it, I can assure you that after nine hours on the tarmac, most of us could care less if our flight counted against cancellation statistics — nor were we in any mood to remain seated for the flight to our destination. Most of us just wanted to go back into the terminal so we could relieve ourselves, eat and book hotel rooms.
In any event, a September 2008 DOT Regulatory Impact Analysis concluded that, far from increasing cancellations, airlines’ awareness of deplaning costs for delayed flights could instead result in better flight management and improved operations overall.
As for the notion that three hours is a “hard-and-fast inflexible timeframe,” I’ll resist the easy temptation to challenge Mr. Castelveter to sit that long in the middle seat in coach without drinkable water or usable toilets.
The fact is, this bipartisan legislation gives maximum flexibility to airports and the airlines alike: Passengers will only be permitted to deplane if it can be done safely, and pilots may extend the time for 30 minutes if there’s a likelihood of immediate departure. Passengers may even choose to remain onboard — but if they do, they’ll be given the chance to change their minds every three hours.
ATA’s Castelveter has also claimed “great progress in reducing lengthy tarmac delays and improving service while on board as reflected in Transportation Department statistics.”
The operative words are “as reflected in Transportation Department statistics.” Those numbers don’t include the 1 million international flights originating in or departing from the U.S. each year, nor any of the smaller carriers that account for one domestic flight out of every four.
Yet setting aside all the flights the DOT excludes, passengers were still stranded on the tarmac for more than three hours on 1,232 flights in 2008 alone. That may represent progress to the airlines, but to their customers, it proves the need for an enforceable time limit.
Kate Hanni
Napa, Calif.
Full story: http://thehill.com/letters/three-hours-on-the-tarmac-legislation-finally-taking-off-2009-07-27.html
Fliers trapped on tarmac push for rules on release - By Gary Stoller, USA TODAY
Brad Dwin was so angry about being stuck on an airplane last month that he volunteered to work for free for a passengers-rights organization.
Dwin, president of a marketing and public relations company, says he spent about six hours on June 10 in a window seat waiting on the tarmac of Washington's Dulles airport for his United Airlines (UAUA) flight to take off to Las Vegas. Looking out the window, he saw other planes waiting. Like Dwin, passengers on those planes were essentially trapped, too.
Being "trapped on a plane for several hours causes a lot of frustration," Dwin, of Silver Spring, Md., says. "You reach a certain point when people with a calm demeanor get angry."
Dwin's anger took him to FlyersRights.org. It's a group that has been lobbying Congress since January 2007 to free airline passengers from being held on planes for hours with no way to get back to the terminal to make other travel arrangements.
"Passengers don't want to be treated like cargo — they want to be treated like paying passengers," says Kate Hanni, who founded FlyersRights.org after her family spent more than eight hours on the tarmac. "Passengers feel completely powerless trapped in a sealed metal tube with no access to goods and services, and no way to get off."
Congress has gotten the message. Legislation that would let passengers get off planes delayed on airport tarmacs is moving through the House and Senate as part of a bill reauthorizing and funding the Federal Aviation Administration.
A Senate committee last week voted to require airlines to let passengers get off planes that are delayed for more than three hours. The House has passed a less specific version. It requires each airline to submit to the Transportation Department a plan to allow passengers to get off planes with long delays.
For many irate fliers, action seems overdue. About 200,000 domestic passengers such as Dwin have been stuck on about 3,000 planes for three hours or more waiting to take off or taxi to a gate since January 2007, a USA TODAY analysis of Transportation Department data shows. Between October 2008 and May 2009, there were 577 planes that sat for that long.
The airlines, however, say that long delays are rare and result mostly from bad weather and a backed-up air-traffic-control system. They warn that forcing them to return planes to terminals after three hours could often make matters worse.
"Such a rule would result in numerous unintended consequences that ultimately will create inconveniences for passengers and lead to more flight cancellations," says David Castelveter, vice president of the Air Transport Association of America, which represents U.S. airlines.
Babies were crying
The USA TODAY analysis of delays that the airlines report to the Transportation Department finds that long delays are rare. Between October and May, when 19 big airlines operated 4.3 million domestic flights, the 577 delays of three hours or more translated into a rate of 1.35 flights per every 10,000.
That's of little consolation to passengers such as Dwin, 38, who says he had little room to get up and stretch. Two disabled passengers in his row made it difficult to leave his seat. But, he says, "The most frustrating thing was that no one from United gave accurate information about the situation or showed any remorse."
United's Robin Urbanski says Dwin and his fellow passengers were stuck in the plane because of bad weather and the plane's loss of power steering. "As a goodwill gesture," she says, passengers were offered frequent-flier miles or a discount off a future flight.
Dwin's experience wasn't nearly as bad as what Nancy Whitehead of Orange, Calif., says she and seven family members and friends endured on a delayed Delta Air Lines (DAL) flight from the Turks and Caicos islands of the Caribbean to Atlanta on April 10.
The flight from the British territory was unable to land because of bad weather in Atlanta. It was diverted to Columbia, S.C., for refueling. There, passengers sat on the plane for at least five hours because of weather, a flight crew that reached its duty-time limits and no U.S. Customs facilities to process any passengers who might want off the flight to make other travel arrangements.
Whitehead, 43, an office manager at an elementary school, says passengers weren't served any food or drink. Toilets backed up, she says, adults got angry, and babies were crying.
Eventually, she says, passengers were allowed to leave the plane and led to a small room at the terminal that had few chairs. Security guards kept an eye on them, security tape blocked access out of the room, she says, and no food was available.
Passengers spent an hour in the hot and humid room before they were moved to another area in the terminal where food could be bought. About 2½ hours later, Whitehead says, passengers boarded the plane for a flight to Atlanta. Then, she says, they had to wait another hour after the pilot announced that one fuel tank had more fuel than another.
Ed Stewart, a Delta spokesman, says the airline has been unfairly criticized for the incident, which was reported by newspaper, TV and air travel websites.
"Multiple strong storm systems" kept the plane from taking off from Columbia, Stewart says. By law, he says, Delta couldn't let passengers off because it was an international flight under the control of U.S. Customs.
Of big airlines, Delta had more long delays (81) than others between October and May, a USA TODAY analysis of the data compiled by the Department's Bureau of Transportation Statistics show. Continental was next, with 72. ExpressJet Airlines had 93 delays on Continental Express (CAL) flights, more than any other carrier.
Like the Delta flight that Whitehead was stranded on, weather played a big role in many delays, and many occurred on the same days. Most delays on Continental and many Continental Express flights occurred on Dec. 10, for instance. That's when "a freak snowstorm" hit Houston, says Continental spokeswoman Julie King.
Since then, King says, Continental has revised its procedures for long-delayed flights. It's improving its de-icing capabilities in Houston and now gives passengers the option of getting off a plane after a three-hour wait.
Airlines blame traffic, too
Mechanical and other safety concerns also contribute to delays. And the airlines say crowded airports and backed-up traffic often make it impractical for pilots to return to terminals.
For example, a mechanical problem and bad weather caused a long delay of an American Eagle flight from Colorado Springs to Dallas on June 10. The plane's air conditioning malfunctioned while waiting to land in bad weather in Dallas, and the aircraft was diverted to Wichita Falls, Texas. It waited there for 4½ hours until maintenance and weather issues were resolved.
Gordon McCracken, a filmmaker in Washington, D.C., says passengers were alarmed when smoke entered the cabin in-flight. On the ground in Wichita Falls, passengers were very cold because the air-conditioning problem caused frigid air to enter the cabin, he says.
American spokesman Tim Smith says airline mechanics found no signs of smoke, and passengers probably saw vapor caused by the cold air from the air-conditioning system. In Wichita Falls, passengers were given the option to get off the plane except for the nearly two hours before takeoff to Dallas, Smith says.
McCracken says the long delay cost him an opportunity to bid on the sale of the apartment he was renting.
American and most U.S. carriers "do not guarantee" passengers will arrive at the scheduled time, Smith says. "Any passenger with an extremely important reason or time to be somewhere should allow for the possibility of extreme delays, especially weather or air-traffic-control related," Smith says.
When planes are backed up for takeoff or landing, there may be no empty gates or equipment available to deplane passengers, the airlines say.
"Because of the antiquated air-traffic-control system in which we — and every airline — operate, we're restricted as to the operational improvements we can make," says Bryan Baldwin, spokesman for JetBlue Airways.
Aviation consultant Michael Boyd says airline CEOs "should form a conga line" to the FAA, which oversees air travel, and demand the country's air-traffic system be modernized. That could increase airspace capacity and reduce the number of waiting planes.
'All about profit'
The airlines aren't blameless, other aviation consultants say. They overschedule flights at hub airports, which creates a situation in which there are too many planes and not enough gates, says Barbara Beyer, CEO of Avmark, an airline consulting company.
Fredrick Foreman of Metron Aviation, who wrote an April report on long ground delays for the FAA, says it's all about money.
"Airlines don't want to deplane passengers because they will lose money," Foreman says. "It's not about weather — it's all about profit motive."
The airlines oppose a hard and fast law that forces them to let passengers off planes that are stranded three hours or more. They prefer letting the airlines decide, says Castelveter of the Air Transport Association.
Forcing planes to return to the gate to let passengers off after three hours "would be highly disruptive to airport and airline operations," he says. "Airlines need operational flexibility in order to get passengers, crewmembers and aircraft to their destinations."
The American Society of Travel Agents initially agreed with the airlines, but now supports congressional action.
Paul Ruden, the society's senior vice president, was on a Transportation Department task force last year that recommended airlines keep passengers informed about delays and establish time limits at each airport for deplaning passengers. But that hasn't worked, he says, and Congress now needs to set "a clear standard for the airlines to follow."
Contributing: Barbara Hansen
Find this article at:
http://www.usatoday.com/travel/flights/2009-07-27-travel-runway-delays_N.htm
Dwin, president of a marketing and public relations company, says he spent about six hours on June 10 in a window seat waiting on the tarmac of Washington's Dulles airport for his United Airlines (UAUA) flight to take off to Las Vegas. Looking out the window, he saw other planes waiting. Like Dwin, passengers on those planes were essentially trapped, too.
Being "trapped on a plane for several hours causes a lot of frustration," Dwin, of Silver Spring, Md., says. "You reach a certain point when people with a calm demeanor get angry."
Dwin's anger took him to FlyersRights.org. It's a group that has been lobbying Congress since January 2007 to free airline passengers from being held on planes for hours with no way to get back to the terminal to make other travel arrangements.
"Passengers don't want to be treated like cargo — they want to be treated like paying passengers," says Kate Hanni, who founded FlyersRights.org after her family spent more than eight hours on the tarmac. "Passengers feel completely powerless trapped in a sealed metal tube with no access to goods and services, and no way to get off."
Congress has gotten the message. Legislation that would let passengers get off planes delayed on airport tarmacs is moving through the House and Senate as part of a bill reauthorizing and funding the Federal Aviation Administration.
A Senate committee last week voted to require airlines to let passengers get off planes that are delayed for more than three hours. The House has passed a less specific version. It requires each airline to submit to the Transportation Department a plan to allow passengers to get off planes with long delays.
For many irate fliers, action seems overdue. About 200,000 domestic passengers such as Dwin have been stuck on about 3,000 planes for three hours or more waiting to take off or taxi to a gate since January 2007, a USA TODAY analysis of Transportation Department data shows. Between October 2008 and May 2009, there were 577 planes that sat for that long.
The airlines, however, say that long delays are rare and result mostly from bad weather and a backed-up air-traffic-control system. They warn that forcing them to return planes to terminals after three hours could often make matters worse.
"Such a rule would result in numerous unintended consequences that ultimately will create inconveniences for passengers and lead to more flight cancellations," says David Castelveter, vice president of the Air Transport Association of America, which represents U.S. airlines.
Babies were crying
The USA TODAY analysis of delays that the airlines report to the Transportation Department finds that long delays are rare. Between October and May, when 19 big airlines operated 4.3 million domestic flights, the 577 delays of three hours or more translated into a rate of 1.35 flights per every 10,000.
That's of little consolation to passengers such as Dwin, 38, who says he had little room to get up and stretch. Two disabled passengers in his row made it difficult to leave his seat. But, he says, "The most frustrating thing was that no one from United gave accurate information about the situation or showed any remorse."
United's Robin Urbanski says Dwin and his fellow passengers were stuck in the plane because of bad weather and the plane's loss of power steering. "As a goodwill gesture," she says, passengers were offered frequent-flier miles or a discount off a future flight.
Dwin's experience wasn't nearly as bad as what Nancy Whitehead of Orange, Calif., says she and seven family members and friends endured on a delayed Delta Air Lines (DAL) flight from the Turks and Caicos islands of the Caribbean to Atlanta on April 10.
The flight from the British territory was unable to land because of bad weather in Atlanta. It was diverted to Columbia, S.C., for refueling. There, passengers sat on the plane for at least five hours because of weather, a flight crew that reached its duty-time limits and no U.S. Customs facilities to process any passengers who might want off the flight to make other travel arrangements.
Whitehead, 43, an office manager at an elementary school, says passengers weren't served any food or drink. Toilets backed up, she says, adults got angry, and babies were crying.
Eventually, she says, passengers were allowed to leave the plane and led to a small room at the terminal that had few chairs. Security guards kept an eye on them, security tape blocked access out of the room, she says, and no food was available.
Passengers spent an hour in the hot and humid room before they were moved to another area in the terminal where food could be bought. About 2½ hours later, Whitehead says, passengers boarded the plane for a flight to Atlanta. Then, she says, they had to wait another hour after the pilot announced that one fuel tank had more fuel than another.
Ed Stewart, a Delta spokesman, says the airline has been unfairly criticized for the incident, which was reported by newspaper, TV and air travel websites.
"Multiple strong storm systems" kept the plane from taking off from Columbia, Stewart says. By law, he says, Delta couldn't let passengers off because it was an international flight under the control of U.S. Customs.
Of big airlines, Delta had more long delays (81) than others between October and May, a USA TODAY analysis of the data compiled by the Department's Bureau of Transportation Statistics show. Continental was next, with 72. ExpressJet Airlines had 93 delays on Continental Express (CAL) flights, more than any other carrier.
Like the Delta flight that Whitehead was stranded on, weather played a big role in many delays, and many occurred on the same days. Most delays on Continental and many Continental Express flights occurred on Dec. 10, for instance. That's when "a freak snowstorm" hit Houston, says Continental spokeswoman Julie King.
Since then, King says, Continental has revised its procedures for long-delayed flights. It's improving its de-icing capabilities in Houston and now gives passengers the option of getting off a plane after a three-hour wait.
Airlines blame traffic, too
Mechanical and other safety concerns also contribute to delays. And the airlines say crowded airports and backed-up traffic often make it impractical for pilots to return to terminals.
For example, a mechanical problem and bad weather caused a long delay of an American Eagle flight from Colorado Springs to Dallas on June 10. The plane's air conditioning malfunctioned while waiting to land in bad weather in Dallas, and the aircraft was diverted to Wichita Falls, Texas. It waited there for 4½ hours until maintenance and weather issues were resolved.
Gordon McCracken, a filmmaker in Washington, D.C., says passengers were alarmed when smoke entered the cabin in-flight. On the ground in Wichita Falls, passengers were very cold because the air-conditioning problem caused frigid air to enter the cabin, he says.
American spokesman Tim Smith says airline mechanics found no signs of smoke, and passengers probably saw vapor caused by the cold air from the air-conditioning system. In Wichita Falls, passengers were given the option to get off the plane except for the nearly two hours before takeoff to Dallas, Smith says.
McCracken says the long delay cost him an opportunity to bid on the sale of the apartment he was renting.
American and most U.S. carriers "do not guarantee" passengers will arrive at the scheduled time, Smith says. "Any passenger with an extremely important reason or time to be somewhere should allow for the possibility of extreme delays, especially weather or air-traffic-control related," Smith says.
When planes are backed up for takeoff or landing, there may be no empty gates or equipment available to deplane passengers, the airlines say.
"Because of the antiquated air-traffic-control system in which we — and every airline — operate, we're restricted as to the operational improvements we can make," says Bryan Baldwin, spokesman for JetBlue Airways.
Aviation consultant Michael Boyd says airline CEOs "should form a conga line" to the FAA, which oversees air travel, and demand the country's air-traffic system be modernized. That could increase airspace capacity and reduce the number of waiting planes.
'All about profit'
The airlines aren't blameless, other aviation consultants say. They overschedule flights at hub airports, which creates a situation in which there are too many planes and not enough gates, says Barbara Beyer, CEO of Avmark, an airline consulting company.
Fredrick Foreman of Metron Aviation, who wrote an April report on long ground delays for the FAA, says it's all about money.
"Airlines don't want to deplane passengers because they will lose money," Foreman says. "It's not about weather — it's all about profit motive."
The airlines oppose a hard and fast law that forces them to let passengers off planes that are stranded three hours or more. They prefer letting the airlines decide, says Castelveter of the Air Transport Association.
Forcing planes to return to the gate to let passengers off after three hours "would be highly disruptive to airport and airline operations," he says. "Airlines need operational flexibility in order to get passengers, crewmembers and aircraft to their destinations."
The American Society of Travel Agents initially agreed with the airlines, but now supports congressional action.
Paul Ruden, the society's senior vice president, was on a Transportation Department task force last year that recommended airlines keep passengers informed about delays and establish time limits at each airport for deplaning passengers. But that hasn't worked, he says, and Congress now needs to set "a clear standard for the airlines to follow."
Contributing: Barbara Hansen
Find this article at:
http://www.usatoday.com/travel/flights/2009-07-27-travel-runway-delays_N.htm
Thursday, July 23, 2009
S.1451 Passengers Rights and other Consumer Language
SEC. 401. AIRLINE CUSTOMER SERVICE COMMITMENT.
(a) In General- Chapter 417 is amended by adding at the end the following:
`SUBCHAPTER IV--AIRLINE CUSTOMER SERVICE
`Sec. 41781. Air carrier and airport contingency plans for long on-board tarmac delays
`(a) Definition of Tarmac Delay- The term `tarmac delay' means the holding of an aircraft on the ground before taking off or after landing with no opportunity for its passengers to deplane.
`(b) Submission of Air Carrier and Airport Plans- Not later than 60 days after the date of the enactment of the FAA Air Transportation Modernization and Safety Improvement Act, each air carrier and airport operator shall submit, in accordance with the requirements under this section, a proposed contingency plan to the Secretary of Transportation for review and approval.
`(c) Minimum Standards- The Secretary of Transportation shall establish minimum standards for elements in contingency plans required to be submitted under this section to ensure that such plans effectively address long on-board tarmac delays and provide for the health and safety of passengers and crew.
`(d) Air Carrier Plans- The plan shall require each air carrier to implement at a minimum the following:
`(1) PROVISION OF ESSENTIAL SERVICES- Each air carrier shall provide for the essential needs of passengers on board an aircraft at an airport in any case in which the departure of a flight is delayed or disembarkation of passengers on an arriving flight that has landed is substantially delayed, including--
`(A) adequate food and potable water;
`(B) adequate restroom facilities;
`(C) cabin ventilation and comfortable cabin temperatures; and
`(D) access to necessary medical treatment.
`(2) RIGHT TO DEPLANE-
`(A) IN GENERAL- Each air carrier shall submit a proposed contingency plan to the Secretary of Transportation that identifies a clear time frame under which passengers would be permitted to deplane a delayed aircraft. After the Secretary has reviewed and approved the proposed plan, the air carrier shall make the plan available to the public.
`(B) DELAYS-
`(i) IN GENERAL- As part of the plan, except as provided under clause (iii), an air carrier shall provide passengers with the option of deplaning and returning to the terminal at which such deplaning could be safely completed, or deplaning at the terminal if--
`(I) 3 hours have elapsed after passengers have boarded the aircraft, the aircraft doors are closed, and the aircraft has not departed; or
`(II) 3 hours have elapsed after the aircraft has landed and the passengers on the aircraft have been unable to deplane.
`(ii) FREQUENCY- The option described in clause (i) shall be offered to passengers at a minimum not less often than once during each successive 3-hour period that the plane remains on the ground.
`(iii) EXCEPTIONS- This subparagraph shall not apply if--
`(I) the pilot of such aircraft reasonably determines that the aircraft will depart or be unloaded at the terminal not later than 30 minutes after the 3 hour delay; or
`(II) the pilot of such aircraft reasonably determines that permitting a passenger to deplane would jeopardize passenger safety or security.
`(C) APPLICATION TO DIVERTED FLIGHTS- This section applies to aircraft without regard to whether they have been diverted to an airport other than the original destination.
`(D) REPORTS- Not later than 30 days after any flight experiences a tarmac delay lasting at least 3 hours, the air carrier responsible for such flight shall submit a written description of the incident and its resolution to the Aviation Consumer Protection Office of the Department of Transportation.
`(e) Airport Plans- Each airport operator shall submit a proposed contingency plan under subsection (b) that contains a description of--
`(1) how the airport operator will provide for the deplanement of passengers following a long tarmac delay; and
`(2) how, to the maximum extent practicable, the airport operator will provide for the sharing of facilities and make gates available at the airport for use by aircraft experiencing such delays.
`(f) Updates- The Secretary shall require periodic reviews and updates of the plans as necessary.
`(g) Approval-
`(1) IN GENERAL- Not later than 6 months after the date of the enactment of this section, the Secretary of Transportation shall--
`(A) review the initial contingency plans submitted under subsection (b); and
`(B) approve plans that closely adhere to the standards described in subsections (d) or (e), whichever is applicable.
`(2) UPDATES- Not later than 60 days after the submission of an update under subsection (f) or an initial contingency plan by a new air carrier or airport, the Secretary shall--
`(A) review the plan; and
`(B) approve the plan if it closely adheres to the standards described in subsections (d) or (e), whichever is applicable.
`(h) Civil Penalties- The Secretary may assess a civil penalty under section 46301 against any air carrier or airport operator that does not submit, obtain approval of, or adhere to a contingency plan submitted under this section.
`(i) Public Access- Each air carrier and airport operator required to submit a contingency plan under this section shall ensure public access to an approved plan under this section by--
`(1) including the plan on the Internet Web site of the carrier or airport; or
`(2) disseminating the plan by other means, as determined by the Secretary.
`Sec. 41782. Air passenger complaints hotline and information
`(a) Air Passenger Complaints Hotline Telephone Number- The Secretary of Transportation shall establish a consumer complaints hotline telephone number for the use of air passengers.
`(b) Public Notice- The Secretary shall notify the public of the telephone number established under subsection (a).
`(c) Authorization of Appropriations- There are authorized to be appropriated such sums as may be necessary to carry out this section, which sums shall remain available until expended.'.
(b) Conforming Amendment- The table of contents for chapter 417 is amended by adding at the end the following:
`subchapter iv--airline customer service
`41781. Air carrier and airport contingency plans for long on-board tarmac delays.
`41782. Air passenger complaints hotline and information.'.
SEC. 402. PUBLICATION OF CUSTOMER SERVICE DATA AND FLIGHT DELAY HISTORY.
(a) In General- Section 41722 is amended by adding at the end the following:
`(f) Chronically Delayed Flights-
`(1) PUBLICATION OF LIST OF FLIGHTS- Each air carrier holding a certificate issued under section 41102 that conducts scheduled passenger air transportation shall, on a monthly basis--
`(A) publish and update on the Internet website of the air carrier a list of chronically delayed flights operated by such air carrier; and
`(B) share such list with each entity that is authorized to book passenger air transportation for such air carrier for inclusion on the Internet website of such entity.
`(2) DISCLOSURE TO CUSTOMERS WHEN PURCHASING TICKETS- For each individual who books passenger air transportation on the Internet website of an air carrier, or the Internet website of an entity that is authorized to book passenger air transportation for an air carrier, for any flight for which data is reported to the Department of Transportation under part 234 of title 14, Code of Federal Regulations, such air carrier or entity, as the case may be, shall prominently disclose to such individual, before such individual makes such booking, the following:
`(A) The on-time performance for the flight if the flight is a chronically delayed flight.
`(B) The cancellation rate for the flight if the flight is a chronically canceled flight.
`(3) DEFINITIONS- In this subsection:
`(A) CHRONICALLY DELAYED FLIGHT- The term `chronically delayed flight' means a regularly scheduled flight that has failed to arrive on time (as such term is defined in section 234.2 of title 14, Code of Federal Regulations) at least 40 percent of the time during the most recent 3-month period for which data is available.
`(B) CHRONICALLY CANCELED FLIGHT- The term `chronically canceled flight' means a regularly scheduled flight at least 30 percent of the departures of which have been canceled during the most recent 3-month period for which data is available.'.
(b) Effective Date- The amendment made by subsection (a) shall take effect 180 days after the date of enactment of this Act.
SEC. 403. EXPANSION OF DOT AIRLINE CONSUMER COMPLAINT INVESTIGATIONS.
(a) IN GENERAL- Subject to the availability of appropriations, the Secretary of Transportation shall investigate consumer complaints regarding--
(1) flight cancellations;
(2) compliance with Federal regulations concerning overbooking seats flights;
(3) lost, damaged, or delayed baggage, and difficulties with related airline claims procedures;
(4) problems in obtaining refunds for unused or lost tickets or fare adjustments;
(5) incorrect or incomplete information about fares, discount fare conditions and availability, overcharges, and fare increases;
(6) the rights of passengers who hold frequent flier miles, or equivalent redeemable awards earned through customer-loyalty programs; and
(7) deceptive or misleading advertising.
(b) BUDGET NEEDS REPORT- The Secretary shall provide, as an annex to its annual budget request, an estimate of resources which would have been sufficient to investigate all such claims the Department of Transportation received in the previous fiscal year. The annex shall be transmitted to the Congress when the President submits the budget of the United States to the Congress under section 1105 of title 31, United States Code.
SEC. 404. ESTABLISHMENT OF ADVISORY COMMITTEE FOR AVIATION CONSUMER PROTECTION.
(a) IN GENERAL- The Secretary of Transportation shall establish an advisory committee for aviation consumer protection to advise the Secretary in carrying out airline customer service improvements, including those required by subchapter IV of chapter 417 of title 49, United States Code.
(b) MEMBERSHIP- The Secretary shall appoint members of the advisory committee comprised of one representative each of--
(1) air carriers;
(2) airport operators;
(3) State or local governments who has expertise in consumer protection matters; and
(4) a nonprofit public interest group who has expertise in consumer protection matters.
(c) VACANCIES- A vacancy in the advisory committee shall be filled in the manner in which the original appointment was made.
(d) TRAVEL EXPENSES- Members of the advisory committee shall serve without pay but shall receive travel expenses, including per diem in lieu of subsistence, in accordance with subchapter I of chapter 57 of title 5, United States Code.
(e) CHAIRPERSON- The Secretary shall designate, from among the individuals appointed under subsection (b), an individual to serve as chairperson of the advisory committee.
(f) DUTIES- The duties of the advisory committee shall include--
(1) evaluating existing aviation consumer protection programs and providing recommendations for the improvement of such programs, if needed; and
(2) providing recommendations to establish additional aviation consumer protection programs, if needed.
(g) REPORT- Not later than February 1 of each of the first 2 calendar years beginning after the date of enactment of this Act, the Secretary shall transmit to Congress a report containing--
(1) the recommendations made by the advisory committee during the preceding calendar year; and
(2) an explanation of how the Secretary has implemented each recommendation and, for each recommendation not implemented, the Secretary's reason for not implementing the recommendation.
SEC. 405. DISCLOSURE OF PASSENGER FEES.
(a) IN GENERAL- Within 180 days after the date of enactment of this Act, the Secretary of Transportation shall complete a rulemaking that requires each air carrier operating in the United States under part 121 of title 49, Code of Federal Regulations, to make available to the public and to the Secretary a list of all passenger fees and charges (other than airfare) that may be imposed by the air carrier, including fees for--
(1) checked baggage or oversized or heavy baggage;
(2) meals, beverages, or other refreshments;
(3) seats in exit rows, seats with additional space, or other preferred seats in any given class of travel;
(4) purchasing tickets from an airline ticket agent or a travel agency; or
(5) any other good, service, or amenity provided by the air carrier, as required by the Secretary.
(b) PUBLICATION; UPDATES- In order to ensure that the fee information required by subsection (a) is both current and widely available to the travelling public, the Secretary--
(1) may require an air carrier to make such information on any public website maintained by an air carrier, to make such information available to travel agencies, and to notify passengers of the availability of such information when advertising airfares; and
(2) shall require air carriers to update the information as necessary, but no less frequently than every 90 days unless there has been no increase in the amount or type of fees shown in the most recent publication.
(a) In General- Chapter 417 is amended by adding at the end the following:
`SUBCHAPTER IV--AIRLINE CUSTOMER SERVICE
`Sec. 41781. Air carrier and airport contingency plans for long on-board tarmac delays
`(a) Definition of Tarmac Delay- The term `tarmac delay' means the holding of an aircraft on the ground before taking off or after landing with no opportunity for its passengers to deplane.
`(b) Submission of Air Carrier and Airport Plans- Not later than 60 days after the date of the enactment of the FAA Air Transportation Modernization and Safety Improvement Act, each air carrier and airport operator shall submit, in accordance with the requirements under this section, a proposed contingency plan to the Secretary of Transportation for review and approval.
`(c) Minimum Standards- The Secretary of Transportation shall establish minimum standards for elements in contingency plans required to be submitted under this section to ensure that such plans effectively address long on-board tarmac delays and provide for the health and safety of passengers and crew.
`(d) Air Carrier Plans- The plan shall require each air carrier to implement at a minimum the following:
`(1) PROVISION OF ESSENTIAL SERVICES- Each air carrier shall provide for the essential needs of passengers on board an aircraft at an airport in any case in which the departure of a flight is delayed or disembarkation of passengers on an arriving flight that has landed is substantially delayed, including--
`(A) adequate food and potable water;
`(B) adequate restroom facilities;
`(C) cabin ventilation and comfortable cabin temperatures; and
`(D) access to necessary medical treatment.
`(2) RIGHT TO DEPLANE-
`(A) IN GENERAL- Each air carrier shall submit a proposed contingency plan to the Secretary of Transportation that identifies a clear time frame under which passengers would be permitted to deplane a delayed aircraft. After the Secretary has reviewed and approved the proposed plan, the air carrier shall make the plan available to the public.
`(B) DELAYS-
`(i) IN GENERAL- As part of the plan, except as provided under clause (iii), an air carrier shall provide passengers with the option of deplaning and returning to the terminal at which such deplaning could be safely completed, or deplaning at the terminal if--
`(I) 3 hours have elapsed after passengers have boarded the aircraft, the aircraft doors are closed, and the aircraft has not departed; or
`(II) 3 hours have elapsed after the aircraft has landed and the passengers on the aircraft have been unable to deplane.
`(ii) FREQUENCY- The option described in clause (i) shall be offered to passengers at a minimum not less often than once during each successive 3-hour period that the plane remains on the ground.
`(iii) EXCEPTIONS- This subparagraph shall not apply if--
`(I) the pilot of such aircraft reasonably determines that the aircraft will depart or be unloaded at the terminal not later than 30 minutes after the 3 hour delay; or
`(II) the pilot of such aircraft reasonably determines that permitting a passenger to deplane would jeopardize passenger safety or security.
`(C) APPLICATION TO DIVERTED FLIGHTS- This section applies to aircraft without regard to whether they have been diverted to an airport other than the original destination.
`(D) REPORTS- Not later than 30 days after any flight experiences a tarmac delay lasting at least 3 hours, the air carrier responsible for such flight shall submit a written description of the incident and its resolution to the Aviation Consumer Protection Office of the Department of Transportation.
`(e) Airport Plans- Each airport operator shall submit a proposed contingency plan under subsection (b) that contains a description of--
`(1) how the airport operator will provide for the deplanement of passengers following a long tarmac delay; and
`(2) how, to the maximum extent practicable, the airport operator will provide for the sharing of facilities and make gates available at the airport for use by aircraft experiencing such delays.
`(f) Updates- The Secretary shall require periodic reviews and updates of the plans as necessary.
`(g) Approval-
`(1) IN GENERAL- Not later than 6 months after the date of the enactment of this section, the Secretary of Transportation shall--
`(A) review the initial contingency plans submitted under subsection (b); and
`(B) approve plans that closely adhere to the standards described in subsections (d) or (e), whichever is applicable.
`(2) UPDATES- Not later than 60 days after the submission of an update under subsection (f) or an initial contingency plan by a new air carrier or airport, the Secretary shall--
`(A) review the plan; and
`(B) approve the plan if it closely adheres to the standards described in subsections (d) or (e), whichever is applicable.
`(h) Civil Penalties- The Secretary may assess a civil penalty under section 46301 against any air carrier or airport operator that does not submit, obtain approval of, or adhere to a contingency plan submitted under this section.
`(i) Public Access- Each air carrier and airport operator required to submit a contingency plan under this section shall ensure public access to an approved plan under this section by--
`(1) including the plan on the Internet Web site of the carrier or airport; or
`(2) disseminating the plan by other means, as determined by the Secretary.
`Sec. 41782. Air passenger complaints hotline and information
`(a) Air Passenger Complaints Hotline Telephone Number- The Secretary of Transportation shall establish a consumer complaints hotline telephone number for the use of air passengers.
`(b) Public Notice- The Secretary shall notify the public of the telephone number established under subsection (a).
`(c) Authorization of Appropriations- There are authorized to be appropriated such sums as may be necessary to carry out this section, which sums shall remain available until expended.'.
(b) Conforming Amendment- The table of contents for chapter 417 is amended by adding at the end the following:
`subchapter iv--airline customer service
`41781. Air carrier and airport contingency plans for long on-board tarmac delays.
`41782. Air passenger complaints hotline and information.'.
SEC. 402. PUBLICATION OF CUSTOMER SERVICE DATA AND FLIGHT DELAY HISTORY.
(a) In General- Section 41722 is amended by adding at the end the following:
`(f) Chronically Delayed Flights-
`(1) PUBLICATION OF LIST OF FLIGHTS- Each air carrier holding a certificate issued under section 41102 that conducts scheduled passenger air transportation shall, on a monthly basis--
`(A) publish and update on the Internet website of the air carrier a list of chronically delayed flights operated by such air carrier; and
`(B) share such list with each entity that is authorized to book passenger air transportation for such air carrier for inclusion on the Internet website of such entity.
`(2) DISCLOSURE TO CUSTOMERS WHEN PURCHASING TICKETS- For each individual who books passenger air transportation on the Internet website of an air carrier, or the Internet website of an entity that is authorized to book passenger air transportation for an air carrier, for any flight for which data is reported to the Department of Transportation under part 234 of title 14, Code of Federal Regulations, such air carrier or entity, as the case may be, shall prominently disclose to such individual, before such individual makes such booking, the following:
`(A) The on-time performance for the flight if the flight is a chronically delayed flight.
`(B) The cancellation rate for the flight if the flight is a chronically canceled flight.
`(3) DEFINITIONS- In this subsection:
`(A) CHRONICALLY DELAYED FLIGHT- The term `chronically delayed flight' means a regularly scheduled flight that has failed to arrive on time (as such term is defined in section 234.2 of title 14, Code of Federal Regulations) at least 40 percent of the time during the most recent 3-month period for which data is available.
`(B) CHRONICALLY CANCELED FLIGHT- The term `chronically canceled flight' means a regularly scheduled flight at least 30 percent of the departures of which have been canceled during the most recent 3-month period for which data is available.'.
(b) Effective Date- The amendment made by subsection (a) shall take effect 180 days after the date of enactment of this Act.
SEC. 403. EXPANSION OF DOT AIRLINE CONSUMER COMPLAINT INVESTIGATIONS.
(a) IN GENERAL- Subject to the availability of appropriations, the Secretary of Transportation shall investigate consumer complaints regarding--
(1) flight cancellations;
(2) compliance with Federal regulations concerning overbooking seats flights;
(3) lost, damaged, or delayed baggage, and difficulties with related airline claims procedures;
(4) problems in obtaining refunds for unused or lost tickets or fare adjustments;
(5) incorrect or incomplete information about fares, discount fare conditions and availability, overcharges, and fare increases;
(6) the rights of passengers who hold frequent flier miles, or equivalent redeemable awards earned through customer-loyalty programs; and
(7) deceptive or misleading advertising.
(b) BUDGET NEEDS REPORT- The Secretary shall provide, as an annex to its annual budget request, an estimate of resources which would have been sufficient to investigate all such claims the Department of Transportation received in the previous fiscal year. The annex shall be transmitted to the Congress when the President submits the budget of the United States to the Congress under section 1105 of title 31, United States Code.
SEC. 404. ESTABLISHMENT OF ADVISORY COMMITTEE FOR AVIATION CONSUMER PROTECTION.
(a) IN GENERAL- The Secretary of Transportation shall establish an advisory committee for aviation consumer protection to advise the Secretary in carrying out airline customer service improvements, including those required by subchapter IV of chapter 417 of title 49, United States Code.
(b) MEMBERSHIP- The Secretary shall appoint members of the advisory committee comprised of one representative each of--
(1) air carriers;
(2) airport operators;
(3) State or local governments who has expertise in consumer protection matters; and
(4) a nonprofit public interest group who has expertise in consumer protection matters.
(c) VACANCIES- A vacancy in the advisory committee shall be filled in the manner in which the original appointment was made.
(d) TRAVEL EXPENSES- Members of the advisory committee shall serve without pay but shall receive travel expenses, including per diem in lieu of subsistence, in accordance with subchapter I of chapter 57 of title 5, United States Code.
(e) CHAIRPERSON- The Secretary shall designate, from among the individuals appointed under subsection (b), an individual to serve as chairperson of the advisory committee.
(f) DUTIES- The duties of the advisory committee shall include--
(1) evaluating existing aviation consumer protection programs and providing recommendations for the improvement of such programs, if needed; and
(2) providing recommendations to establish additional aviation consumer protection programs, if needed.
(g) REPORT- Not later than February 1 of each of the first 2 calendar years beginning after the date of enactment of this Act, the Secretary shall transmit to Congress a report containing--
(1) the recommendations made by the advisory committee during the preceding calendar year; and
(2) an explanation of how the Secretary has implemented each recommendation and, for each recommendation not implemented, the Secretary's reason for not implementing the recommendation.
SEC. 405. DISCLOSURE OF PASSENGER FEES.
(a) IN GENERAL- Within 180 days after the date of enactment of this Act, the Secretary of Transportation shall complete a rulemaking that requires each air carrier operating in the United States under part 121 of title 49, Code of Federal Regulations, to make available to the public and to the Secretary a list of all passenger fees and charges (other than airfare) that may be imposed by the air carrier, including fees for--
(1) checked baggage or oversized or heavy baggage;
(2) meals, beverages, or other refreshments;
(3) seats in exit rows, seats with additional space, or other preferred seats in any given class of travel;
(4) purchasing tickets from an airline ticket agent or a travel agency; or
(5) any other good, service, or amenity provided by the air carrier, as required by the Secretary.
(b) PUBLICATION; UPDATES- In order to ensure that the fee information required by subsection (a) is both current and widely available to the travelling public, the Secretary--
(1) may require an air carrier to make such information on any public website maintained by an air carrier, to make such information available to travel agencies, and to notify passengers of the availability of such information when advertising airfares; and
(2) shall require air carriers to update the information as necessary, but no less frequently than every 90 days unless there has been no increase in the amount or type of fees shown in the most recent publication.
Tuesday, July 21, 2009
AIRLINE PASSENGERS BILL OF RIGHTS IN SENATE COMMERCE COMMITTEE TUESDAY, JULY 21 !!!
The Senate Commerce Committee FAA Reauthorization includes the bipartisan Boxer-Snowe Airline Passengers Bill of Rights, giving passengers the option to safely de-plane after three hours on the tarmac. The Committee is scheduled to take up the measure on TUESDAY, JULY 21 at 2:30 PM in SR-253, Room 253 of the Russell Senate Office Building.
WE NEED YOU TO CALL OR EMAIL THE MEMBERS OF THE COMMITTEE TO SHOW YOUR SUPPORT FOR THESE IMPORTANT AIRLINE PASSENGER PROTECTIONS.
Urge the Senators to SUPPORT the Airline Passengers Bill of Rights as contained in S. 1451, the Federal Aviation Administration Air Transportation Modernization and Safety Improvement Act.
Below are the Members of the Commerce Committee, with links to their websites. Please register your support by:
r CALLING THE SENATE SWITCHBOARD AT 202-224-3121 (be aware, phone circuits are often busy, but the switchboard will connect you immediately to any Senator’s office you wish)
r CALLING EACH SENATOR’S OFFICE (the names below will link you to their websites)
r EMAILING EACH SENATOR INDIVIDUALLY (again, the names below will link you to their websites, where you will find their emails)
Democrats
John D. Rockefeller, IV
(Chairman)
Daniel K. Inouye
John F. Kerry
Byron L. Dorgan
Barbara Boxer
Bill Nelson
Maria Cantwell
Frank R. Lautenberg
Mark Pryor
Claire McCaskill
Amy Klobuchar
Tom Udall
Mark Warner
Mark Begich
Republicans
Kay Bailey Hutchison
(Ranking Member)
Olympia J. Snowe
John Ensign
Jim DeMint
John Thune
Roger Wicker
Johnny Isakson
David Vitter
Sam Brownback
Mel Martinez
Mike Johanns
WE NEED YOU TO CALL OR EMAIL THE MEMBERS OF THE COMMITTEE TO SHOW YOUR SUPPORT FOR THESE IMPORTANT AIRLINE PASSENGER PROTECTIONS.
Urge the Senators to SUPPORT the Airline Passengers Bill of Rights as contained in S. 1451, the Federal Aviation Administration Air Transportation Modernization and Safety Improvement Act.
Below are the Members of the Commerce Committee, with links to their websites. Please register your support by:
r CALLING THE SENATE SWITCHBOARD AT 202-224-3121 (be aware, phone circuits are often busy, but the switchboard will connect you immediately to any Senator’s office you wish)
r CALLING EACH SENATOR’S OFFICE (the names below will link you to their websites)
r EMAILING EACH SENATOR INDIVIDUALLY (again, the names below will link you to their websites, where you will find their emails)
Democrats
John D. Rockefeller, IV
(Chairman)
Daniel K. Inouye
John F. Kerry
Byron L. Dorgan
Barbara Boxer
Bill Nelson
Maria Cantwell
Frank R. Lautenberg
Mark Pryor
Claire McCaskill
Amy Klobuchar
Tom Udall
Mark Warner
Mark Begich
Republicans
Kay Bailey Hutchison
(Ranking Member)
Olympia J. Snowe
John Ensign
Jim DeMint
John Thune
Roger Wicker
Johnny Isakson
David Vitter
Sam Brownback
Mel Martinez
Mike Johanns
Wednesday, July 15, 2009
HUGE VICTORY FOR AIRLINE PASSENGERS!
COMMERCE COMMITTEE INCLUDES BOXER-SNOWE AIRLINE PASSENGERS BILL OF RIGHTS IN FAA REAUTHORIZATION
Bill Also Includes Snowe-Boxer Provisions to Strengthen Aviation Safety
July 14, 2009
Washington, D.C. -
U.S. Senators Olympia Snowe (R-ME) and Barbara Boxer (D-CA) praised the Senate Commerce Committee for including their Airline Passengers Bill of Rights in the Federal Aviation Administration (FAA) Reauthorization Bill introduced today.
The Airline Passengers Bill of Rights ensures that – at a minimum – travelers are not unnecessarily trapped on airplanes for excessive periods of time or deprived of food, water or adequate restrooms.
Senator Snowe said, "The government's priority when overseeing aviation?must be?safety.??The Passenger Bill of Rights?must?be the minimum standard for?the safety of?passengers.? The?airlines and the FAA?have failed to act, and?no less an authority than?the federal court system declared only the government can implement a comprehensive customer service regime.? Now, thanks to the Commerce Committee’s action, Congress is going to demand it."?
Senator Boxer said, "I thank the Commerce Committee for recognizing the need for this important legislation.? We are never going to be able to anticipate every problem or stop every delay, but we can ensure that airlines recognize passengers’ basic rights.? Passengers should never be trapped on airplanes for hours and hours without food, safe drinking water or working restrooms. "?
Provisions of the Airline Passengers Bill of Rights introduced by Senators Boxer and Snowe were included in last year’s FAA Reauthorization bill, which was passed by the Commerce Committee but blocked on the Senate floor.? This year, their bill is included in its entirety.
The Airline Passengers Bill of Rights would:
Require airlines to provide passengers with food, potable water, comfortable cabin temperature and ventilation, and adequate restrooms while a plane is delayed on the ground.
Require airlines to provide passengers with food, potable water, comfortable cabin temperature and ventilation, and adequate restrooms while a plane is delayed on the ground.
Require airlines to offer passengers the option of safely deplaning once they have sat on the ground for three hours after the plane door has closed.? This option would be provided every three hours the plane continues to sit on the ground.
Make airports and airlines develop contingency plans for delayed flights to be reviewed and approved by DOT.? The bill also allows the DOT to fine air carriers and airports that do not submit or fail to comply with contingency plans.
Direct the Department of Transportation (DOT) to create a consumer complaint hotline so that passengers can alert the agency about delays.
The bill provides two exceptions to the three-hour option: the pilot may decide not to allow passengers to deplane if he or she believes their safety or security would be at risk due to weather or other emergencies.? Additionally, the pilot may delay deplaning up to 30 minutes beyond the three-hour period if he or she reasonably believes the flight will depart within 30 minutes.
Boxer and Snowe first introduced the Airline Passengers Bill of Rights in 2007 following several incidents where passengers were forced to remain on airplanes for as long as 11 hours.? The case for federal action was strengthened when the U.S. Court of Appeals struck down a New York State law protecting passengers’ rights, saying only the Federal Government has the authority to enact such a law.
The FAA Reauthorization bill also includes key provisions of the Snowe-Boxer Ensuring One Level of Aviation Safety Act of 2009, legislation the Senators introduced following the tragic crash of Continental Connection Flight 3407 outside of Buffalo, New York.? The FAA bill includes the following provisions to strengthen safety standards at regional airlines:
Require the FAA to perform random inspections at flight schools and regional airlines to ensure that training and safety standards are being enforced.
Require the FAA to perform random inspections at flight schools and regional airlines to ensure that training and safety standards are being enforced.
Improve current training standards for pilots and establish remedial and recurring training protocols.
Require the FAA to publicly provide NTSB with a notice of when and how the FAA will implement any NTSB recommendation.
And allow carriers immediate access to a pilot’s records, including failed flight checks, for the duration of their career.?
###
Bill Also Includes Snowe-Boxer Provisions to Strengthen Aviation Safety
July 14, 2009
Washington, D.C. -
U.S. Senators Olympia Snowe (R-ME) and Barbara Boxer (D-CA) praised the Senate Commerce Committee for including their Airline Passengers Bill of Rights in the Federal Aviation Administration (FAA) Reauthorization Bill introduced today.
The Airline Passengers Bill of Rights ensures that – at a minimum – travelers are not unnecessarily trapped on airplanes for excessive periods of time or deprived of food, water or adequate restrooms.
Senator Snowe said, "The government's priority when overseeing aviation?must be?safety.??The Passenger Bill of Rights?must?be the minimum standard for?the safety of?passengers.? The?airlines and the FAA?have failed to act, and?no less an authority than?the federal court system declared only the government can implement a comprehensive customer service regime.? Now, thanks to the Commerce Committee’s action, Congress is going to demand it."?
Senator Boxer said, "I thank the Commerce Committee for recognizing the need for this important legislation.? We are never going to be able to anticipate every problem or stop every delay, but we can ensure that airlines recognize passengers’ basic rights.? Passengers should never be trapped on airplanes for hours and hours without food, safe drinking water or working restrooms. "?
Provisions of the Airline Passengers Bill of Rights introduced by Senators Boxer and Snowe were included in last year’s FAA Reauthorization bill, which was passed by the Commerce Committee but blocked on the Senate floor.? This year, their bill is included in its entirety.
The Airline Passengers Bill of Rights would:
Require airlines to provide passengers with food, potable water, comfortable cabin temperature and ventilation, and adequate restrooms while a plane is delayed on the ground.
Require airlines to provide passengers with food, potable water, comfortable cabin temperature and ventilation, and adequate restrooms while a plane is delayed on the ground.
Require airlines to offer passengers the option of safely deplaning once they have sat on the ground for three hours after the plane door has closed.? This option would be provided every three hours the plane continues to sit on the ground.
Make airports and airlines develop contingency plans for delayed flights to be reviewed and approved by DOT.? The bill also allows the DOT to fine air carriers and airports that do not submit or fail to comply with contingency plans.
Direct the Department of Transportation (DOT) to create a consumer complaint hotline so that passengers can alert the agency about delays.
The bill provides two exceptions to the three-hour option: the pilot may decide not to allow passengers to deplane if he or she believes their safety or security would be at risk due to weather or other emergencies.? Additionally, the pilot may delay deplaning up to 30 minutes beyond the three-hour period if he or she reasonably believes the flight will depart within 30 minutes.
Boxer and Snowe first introduced the Airline Passengers Bill of Rights in 2007 following several incidents where passengers were forced to remain on airplanes for as long as 11 hours.? The case for federal action was strengthened when the U.S. Court of Appeals struck down a New York State law protecting passengers’ rights, saying only the Federal Government has the authority to enact such a law.
The FAA Reauthorization bill also includes key provisions of the Snowe-Boxer Ensuring One Level of Aviation Safety Act of 2009, legislation the Senators introduced following the tragic crash of Continental Connection Flight 3407 outside of Buffalo, New York.? The FAA bill includes the following provisions to strengthen safety standards at regional airlines:
Require the FAA to perform random inspections at flight schools and regional airlines to ensure that training and safety standards are being enforced.
Require the FAA to perform random inspections at flight schools and regional airlines to ensure that training and safety standards are being enforced.
Improve current training standards for pilots and establish remedial and recurring training protocols.
Require the FAA to publicly provide NTSB with a notice of when and how the FAA will implement any NTSB recommendation.
And allow carriers immediate access to a pilot’s records, including failed flight checks, for the duration of their career.?
###
Tuesday, July 14, 2009
Airline Passengers’ Rights Flying High with New Senate Bill
For
Immediate Release:
Contact: Kate Hanni
Phone: (707) 337-0328
Email: kate@flyersrights.org
Napa, CA - 07/14/2009: Today,
the Senate Commerce Committee unveiled its version of the FAA
Reauthorization Act of 2009 which includes important Airline
Passengers’ Bill of Rights provisions. Among those provisions;
“This is a major victory for airline passengers,” said Kate Hanni,
whose organization has been working for over two years for airline
passengers’ bill of rights with a three hour minimum. “But the
war isn’t won yet.” Airline lobbyists are already on the Hill in
force fighting against these provisions. If and when these rights
are eventually passed by the full Senate, House leaders will still have
their say in conference. Despite intense focus over the last two
years to persuade key House leaders of the need to impose time limits,
the House chose to leave that option to the airlines. “This would
have led to mass consumer confusion - one airline could have a limit of
5 hours, and another airline could have set a limit of 10 hours,” says
Ms. Hanni.
“Our coalition and airline passengers everywhere wish to thank the
members and leadership of the Senate Commerce Committee for this
important legislation,” said Ms. Hanni. Chief proponents of the
three-hour limit were Senator Barbara Boxer (D-CA) and Senator Olympia
Snowe (R-ME). Chairman Rockefeller (D-WV) introduced the
bill on behalf of Ranking Member Kay Bailey Hutchison (R-TX), and the
leadership of the Aviation Operations, Safety and Security
Subcommittee, Chairman Byron L. Dorgan (D-ND) and Ranking Member Jim
DeMint (R-SC).
Other airline consumer-friendly provisions were championed by Senator
Frank Lautenberg (D-NJ) and Senator John Thune (R-SD). “It looks
to our coalition as though this was a bipartisan, group effort.
We’re so pleased that this committee is able to work together and focus
on the interests of the flying public,” said Ms. Hanni.
FlyersRights.org has over 25,000 members and is the largest non-profit
airline passengers’ rights coalition. For more information,
contact Kate Hanni directly at 707-337-0328 or Kate@flyersrights.com.
AP Story
Boxer Press Release
Immediate Release:
Contact: Kate Hanni
Phone: (707) 337-0328
Email: kate@flyersrights.org
FlyersRights.org
Applauds Senate Commerce Committee for Recognizing Airline Passengers’
Rights
Applauds Senate Commerce Committee for Recognizing Airline Passengers’
Rights
Napa, CA - 07/14/2009: Today,
the Senate Commerce Committee unveiled its version of the FAA
Reauthorization Act of 2009 which includes important Airline
Passengers’ Bill of Rights provisions. Among those provisions;
- Passengers will have the right to return to the terminal
after three-hours on the tarmac if the pilot determines this can be
done safely. - While on the tarmac, airlines will be required to provide
food, potable water, working restrooms, and reasonable cabin
temperature and ventilation.
“This is a major victory for airline passengers,” said Kate Hanni,
whose organization has been working for over two years for airline
passengers’ bill of rights with a three hour minimum. “But the
war isn’t won yet.” Airline lobbyists are already on the Hill in
force fighting against these provisions. If and when these rights
are eventually passed by the full Senate, House leaders will still have
their say in conference. Despite intense focus over the last two
years to persuade key House leaders of the need to impose time limits,
the House chose to leave that option to the airlines. “This would
have led to mass consumer confusion - one airline could have a limit of
5 hours, and another airline could have set a limit of 10 hours,” says
Ms. Hanni.
“Our coalition and airline passengers everywhere wish to thank the
members and leadership of the Senate Commerce Committee for this
important legislation,” said Ms. Hanni. Chief proponents of the
three-hour limit were Senator Barbara Boxer (D-CA) and Senator Olympia
Snowe (R-ME). Chairman Rockefeller (D-WV) introduced the
bill on behalf of Ranking Member Kay Bailey Hutchison (R-TX), and the
leadership of the Aviation Operations, Safety and Security
Subcommittee, Chairman Byron L. Dorgan (D-ND) and Ranking Member Jim
DeMint (R-SC).
Other airline consumer-friendly provisions were championed by Senator
Frank Lautenberg (D-NJ) and Senator John Thune (R-SD). “It looks
to our coalition as though this was a bipartisan, group effort.
We’re so pleased that this committee is able to work together and focus
on the interests of the flying public,” said Ms. Hanni.
FlyersRights.org has over 25,000 members and is the largest non-profit
airline passengers’ rights coalition. For more information,
contact Kate Hanni directly at 707-337-0328 or Kate@flyersrights.com.
AP Story
Boxer Press Release
###
Monday, July 13, 2009
Airline Data on Diversions "Highly Suspicious"
For Immediate Release:
Contact: Kate Hanni
Phone: (707) 337-0328
Email: kate@flyersrights.org
Airline Data on Diversions “Highly Suspicious”
Statistics Show Some Airlines Let You Decant in the Terminal, Others May Let You Whither on the Vine
Napa, CA - 07/13/2009: Last week, the U.S. Department of Transportation (DOT) released the latest data installment for diverted commercial airline flights – flights that make unscheduled stops before they reach their final destinations; to refuel, or due to weather or other in-flight emergencies. This is the eighth month since the DOT began keeping detailed statistics for diverted flights. An exclusive FlyersRights.org analysis of the data shows that American Airlines, American Eagle, United Airlines, Northwest Airlines and Delta Airlines collectively gave passengers an opportunity to deplane at a diverted airport 66% of the time, while the other fifteen largest U.S. airlines gave passengers that option 99% of the time - according to the government data.
“If you believe DOT’s statistics, you might avoid American, American Eagle, United and Delta because according to the DOT’s numbers, those four airlines have alone been responsible for 1150 of 1181 instances where passengers were not allowed to deplane at a diverted airport”, said Kate Hanni, FlyersRights.org founder and executive director. Ms. Hanni’s was just one of dozens of flights that were diverted on December 29th, 2006. She and her family were stranded on an American Airlines flight on the airport tarmac in Austin, Texas for over nine hours without food, potable water and usable restrooms. According to the statistics, American Airlines did not allow passengers to deplane 61% of the time. The next closest airline was Delta with 47%.
“The data were so shocking that we asked the Bureau of Transportation Statistics (BTS – a department under the DOT) to verify the data before we released our analysis to the public, and we also asked the DOT’s Inspector General to conduct an investigation”, said Ms. Hanni. “If the airlines are not reporting this data correctly, that’s a violation of federal law.” Through both written statements and press accounts, the BTS and the airlines’ trade association have insisted the data is correct. “The IG hasn’t responded as yet.”
“Meanwhile, we have an obligation to let consumers know which airlines have a track record of giving weary passengers an option to wait out the diversion in the comfort of an airport terminal, and which ones don’t”, said Ms. Hanni.
Spreadsheets and methodology for the diversion analysis can be obtained on the organization’s website www.flyersrights.org.
FlyersRights.org has over 25,000 members; the largest non-profit airline passengers’ rights coalition. For information, contact Kate Hanni directly at 707-337-0328 or Kate@flyersrights.com.
Supporting materials for Diverted Flight Press Release
Diverted Flight Analysis Methodology
Diverted Flights Spreadsheet
###
Contact: Kate Hanni
Phone: (707) 337-0328
Email: kate@flyersrights.org
Airline Data on Diversions “Highly Suspicious”
Statistics Show Some Airlines Let You Decant in the Terminal, Others May Let You Whither on the Vine
Napa, CA - 07/13/2009: Last week, the U.S. Department of Transportation (DOT) released the latest data installment for diverted commercial airline flights – flights that make unscheduled stops before they reach their final destinations; to refuel, or due to weather or other in-flight emergencies. This is the eighth month since the DOT began keeping detailed statistics for diverted flights. An exclusive FlyersRights.org analysis of the data shows that American Airlines, American Eagle, United Airlines, Northwest Airlines and Delta Airlines collectively gave passengers an opportunity to deplane at a diverted airport 66% of the time, while the other fifteen largest U.S. airlines gave passengers that option 99% of the time - according to the government data.
“If you believe DOT’s statistics, you might avoid American, American Eagle, United and Delta because according to the DOT’s numbers, those four airlines have alone been responsible for 1150 of 1181 instances where passengers were not allowed to deplane at a diverted airport”, said Kate Hanni, FlyersRights.org founder and executive director. Ms. Hanni’s was just one of dozens of flights that were diverted on December 29th, 2006. She and her family were stranded on an American Airlines flight on the airport tarmac in Austin, Texas for over nine hours without food, potable water and usable restrooms. According to the statistics, American Airlines did not allow passengers to deplane 61% of the time. The next closest airline was Delta with 47%.
“The data were so shocking that we asked the Bureau of Transportation Statistics (BTS – a department under the DOT) to verify the data before we released our analysis to the public, and we also asked the DOT’s Inspector General to conduct an investigation”, said Ms. Hanni. “If the airlines are not reporting this data correctly, that’s a violation of federal law.” Through both written statements and press accounts, the BTS and the airlines’ trade association have insisted the data is correct. “The IG hasn’t responded as yet.”
“Meanwhile, we have an obligation to let consumers know which airlines have a track record of giving weary passengers an option to wait out the diversion in the comfort of an airport terminal, and which ones don’t”, said Ms. Hanni.
Spreadsheets and methodology for the diversion analysis can be obtained on the organization’s website www.flyersrights.org.
FlyersRights.org has over 25,000 members; the largest non-profit airline passengers’ rights coalition. For information, contact Kate Hanni directly at 707-337-0328 or Kate@flyersrights.com.
Supporting materials for Diverted Flight Press Release
Diverted Flight Analysis Methodology
Diverted Flights Spreadsheet
###
Thursday, July 9, 2009
DOT Fines Delta $375,000 related to bumping compensation laws!
DOT 98-09 Thursday, July 9, 2009 Contact: Bill Mosley Tel.: (202) 366-4570
DOT Fines Delta for Violations of Denied Boarding Compensation Rules
The U.S. Department of Transportation (DOT) today assessed a civil penalty against Delta Air Lines for violating federal rules regarding passengers denied boarding (“bumped”) on oversold flights.
“Airlines often oversell flights in order to ensure that they fill all their seats, and the bumping rules are designed to protect consumers when this happens,” said U.S. Transportation Secretary Ray LaHood. “We take these rules seriously and will take enforcement action when necessary.”
Delta was ordered to cease and desist from further violations and assessed a civil penalty of $375,000. Up to $200,000 of the penalty may be used by the carrier to implement systems not required by the rules that will benefit consumers.
When a flight is oversold, DOT regulations require airlines to seek volunteers willing to give up their seats for compensation. If not enough volunteers can be found and the carrier must bump passengers involuntarily, the carrier is required to give bumped passengers a written statement describing their rights and explaining how it decides who will be bumped from an oversold flight. In most cases, passengers bumped involuntarily also are entitled to cash compensation of up to $800.
The Department’s Office of Aviation Enforcement and Proceedings, as part of an on-site investigation at the carrier’s headquarters, reviewed records of Delta’s passenger complaint records from January to July 2008. The office also reviewed similar consumer complaints against Delta received by DOT last year. Both revealed a number of instances in which the carrier bumped passengers but did not follow one or more of the provisions of the oversales rules.
The consent order is available on the Internet at www.regulations.gov, docket DOT-OST-2009-0001. A summary of the oversales rules is available at http://airconsumer.dot.gov/publications/flyrights.htm#overbooking.
DOT Fines Delta for Violations of Denied Boarding Compensation Rules
The U.S. Department of Transportation (DOT) today assessed a civil penalty against Delta Air Lines for violating federal rules regarding passengers denied boarding (“bumped”) on oversold flights.
“Airlines often oversell flights in order to ensure that they fill all their seats, and the bumping rules are designed to protect consumers when this happens,” said U.S. Transportation Secretary Ray LaHood. “We take these rules seriously and will take enforcement action when necessary.”
Delta was ordered to cease and desist from further violations and assessed a civil penalty of $375,000. Up to $200,000 of the penalty may be used by the carrier to implement systems not required by the rules that will benefit consumers.
When a flight is oversold, DOT regulations require airlines to seek volunteers willing to give up their seats for compensation. If not enough volunteers can be found and the carrier must bump passengers involuntarily, the carrier is required to give bumped passengers a written statement describing their rights and explaining how it decides who will be bumped from an oversold flight. In most cases, passengers bumped involuntarily also are entitled to cash compensation of up to $800.
The Department’s Office of Aviation Enforcement and Proceedings, as part of an on-site investigation at the carrier’s headquarters, reviewed records of Delta’s passenger complaint records from January to July 2008. The office also reviewed similar consumer complaints against Delta received by DOT last year. Both revealed a number of instances in which the carrier bumped passengers but did not follow one or more of the provisions of the oversales rules.
The consent order is available on the Internet at www.regulations.gov, docket DOT-OST-2009-0001. A summary of the oversales rules is available at http://airconsumer.dot.gov/publications/flyrights.htm#overbooking.
Wednesday, July 1, 2009
UNITED WE FALL: United puts the squeeze on the Flying Public AGAIN!
United Airlines’ Dangerous Cost-Shifting Scheme
Why Consumers Will Pay Substantially More for Air Travel When Travel Agents are Forced to Pay Airline Credit Card Costs
Contact: Kate Hanni 707-337-0328
Stay Tuned for Public Press Release
BACKGROUND
United Airlines (UA) has told many travel agents and signaled its competitors that it will introduce on July 20, 2009 a radical new cost shifting scheme in the U.S. marketplace. If it succeeds, it will represent the most drastic and misguided scheme ever concocted since the airline industry was deregulated in 1978.
UA will endeavor to shift responsibility for payment of credit card merchant fees, an airline cost of sales, to travel agencies (TAs) who will then have virtually no choice but to pass them on to consumers in the form of higher TA service fees, or to absorb them and risk extinction. This is much more nefarious than just a price increase for consumers; it could remove trusted travel advisors from the distribution chain.
The leisure travel consumer, who purchases some 70% of all airline tickets, is a prime target UA plans to (a) extract supra premium prices from over time at united.com, (b) immediately shift substantial financial risk to and (c) exploit to build cash reserves in advance of its next bankruptcy filing.
Just barely a year after U.S. airlines turned irrevocably to charging consumers twice for product features such as baggage and seats already charged for in the price of an airline ticket, UA is now floating as a trial balloon a scheme that would have the consumer pay its credit card costs. Credit card merchant fees are likewise currently baked into the price of a ticket. This comes at a time when leisure fares have begun a double digit ascent. Consumers need to understand how they will be harmed should this unprecedented industry proposal succeed.
This document will provide the relevant facts and key assumptions, and will call out areas of likely negative impact on consumers.
RELEVANT FACTS
1. UA informed an unspecified number of TAs that effective July 20, 2009 they will not be able to sell UA tickets using UA’s credit card merchant agreements.
2. The policy applies to Visa, MasterCard, American Express, Discover, Diner's Club, JCB.
3. TAs would need to establish merchant accounts with the credit card issuers and settle in cash with UA via the Airline Reporting Corporation (ARC).
4. Under this scheme, some $171 million annually in credit card merchant fees could be transferred from UA to TAs.
5. Targeted TAs that continue using UA’s merchant facilities will receive a $75 debit memo for each ticket sold.
6. TAs can avoid merchant fees and debit memos by booking tickets on UA’s website.
7. UA indicated that TAs may have payment and settlement options through GDSs.
8. It is today not feasible for TAs using their own merchant accounts to book through GDSs. When using a consumer's credit card in the GDS, the charge is to airline’s merchant account. As such, the TA would have to sell “as cash” in the GDS, and accept a credit card outside of the normal workflow.
KEY ASSUMPTIONS
1. For competitive reasons, the only way UA can succeed in implementing its policy on July 20 is if virtually every other large airline indicates it will match UA. In short, UA’s pre-announcement of this scheme is both a trial balloon and smoke signal to its competitors. The additional assumptions and projected consumer impacts that follow are predicated upon a successful industry-wide adoption of UA's transfer of its credit card sales costs to TAs.
2. This UA policy is more than just a wholesale transfer of sales-related expenses; it is targeted. UA is not looking to transfer all its merchant fee costs, just those for consumers who use a TA.
3. Many TAs, especially in today’s tight-credit environment, would not likely be approved for merchant agreements involving high volumes of airline tickets. This would be terminal for these TAs.
4. Some TAs with their own merchant accounts would be at risk of losing their agreements because of a substantial increase in average transaction price; their credit limits would be exceeded. Today, TAs generally use their own merchant accounts for only relatively small service fees (e.g., $30) and not ticket sales (e.g., $300).
5. Those TAs approved for merchant agreements may not find the maximum charge volume allowed, or discount-rate levels offered, sufficient or affordable enough to stay in business. This scheme upends established credit relationships in the travel distribution chain and puts processing costs and financial risk in a place where they cannot and should not be borne.
6. Those TAs approved for merchant agreements may find high reserves and holds required by card companies and processors economically unworkable, forcing TAs to service customers using inefficient airline.coms where merchant fees will presumably be avoided; however, soaring administrative costs, plummeting agent productivity and customer service degradation would soon doom these TAs.
7. Well-resourced larger TAs currently possessing their own merchant agreements, or approved for such agreements because of this new airline industry policy, would be forced to pass the new merchant fees on to customers in the form of higher ticketing service fees. What’s more, most TAs today pay significantly higher discount rates than do large airlines.
8. Those TAs attempting to increase cash transactions would find their ARC bond requirements increasing substantially; in the current economic environment many TAs would simply not qualify for higher levels.
9. Ticketing service fees would be driven to even higher levels as TAs' cost of doing business would skyrocket as systems would need to be radically reprogrammed, i.e., this program is as big as Secure Flight in terms of required system changes to GDSs, back office accounting, mid and front office processing and online booking tools; the booking process would be made significantly more cumbersome and costly to execute.
10. The TA instead of being an “agent” would now be the “service provider,” aka the “merchant,” in the eyes of charge card companies. This risk-transfer to TAs would raise a multitude of new obligations and liabilities such as removing protections from TAs when airlines fail to perform.
11. In accepting merchant fee responsibility, TAs tie their very business survival to airlines’ financial viability. In the case of an airline bankruptcy, the consumer credit card transaction would have been with the TA merchant, but the TA would have paid the airline in cash within a matter of days. As such, the consumer could not request that the credit card company reverse the charge, and the TA would have no way to get the cash back from the airline since it would be just another unsecured creditor. Consumers would demand that TAs refund the ticket amount or if the consumer had not yet paid his credit card invoice, refuse to pay the charge. Consequently, a bankrupt airline would in turn cause the bankruptcy and failure of countless TAs, especially in airline dominated hub airport cities -- while being able to keep cash for tickets that it would not fulfill because it either stopped operating or cancelled the service on which the tickets were sold.
12. In an industry where many companies are serial Chapter 11 filers, it is perhaps no accident that under the UA scheme the TAs that had paid cash for ticket sales are not likely to qualify for the bankruptcy protection given to consumer deposits.
13. TAs would have to deal with the financial impact (e.g., higher costs; reduced financial flexibility) of having the necessary capital on hand to transact with ARC in cash.
14. TAs in the U.S. clear transactions with ARC, and as such, they would be on the line for the entire cost of a ticket in the event of charge card fraud, even though the airline is the service provider. Heretofore, since airlines have been the service providers they have had the means and incentives to take action by denying service to travelers involved with verified fraudulent transactions. For example, it is the airline, not the TA that has the chance after telephone or online sales to physically verify the identity of the traveler at time of check in and to refuse service as necessary.
15. Taken together, these negative impacts are lethally discriminatory toward the TA airline ticket distribution channel and would put it at an insurmountable competitive disadvantage vis-a-vis the airline-direct channel. This sets the stage for TA bypass and considerable consumer harm.
INJURIOUS CONSUMER IMPACTS
1. Consumers who continue to use TAs would pay airlines' credit card sales costs, likely finding TA service fees 50% to 100% higher due to merchant fees being passed on as well as systems reprogramming costs and significantly increased TA administrative and process costs.
2. As TAs go out of business, the independent TA channel for airline ticket distribution will have been substantially weakened, diminishing consumers’ access to complete and accurate information regarding air travel alternatives. And once airlines weaken the neutral TA channel, why would we not expect airlines to start charging all consumers who were to book directly with the airline a “credit card convenience” charge? Ironically, airlines would be in a position to justify such a move later on the grounds that “travel agencies do it.” In any event, there can be no doubt that consumers would pay unnecessarily higher airfares.
3. Better-financed TAs would be able to raise service fees even higher while offering less customer service, especially for those consumers who do not have access to the Internet or who are otherwise uncomfortable with online financial transactions or navigating complex airline websites. The UA move, if matched, would lead to more consolidation and more failures of TAs.
4. New merchant fees and additional costs would create a material price gap between the total-cost of a ticket booked via a TA versus at airline.com. Especially in a recession, unsuspecting consumers would be enticed to airline.com by perceived lower fares, and perhaps short-term inducements, but where the absence of comparison shopping and unbiased, expert TA advice would lead to higher fares paid.
5. As investigated and disclosed by the European Commission last year, the majority of airlines operating in Europe had websites that were misleading and deceptive in the way fare information was displayed. A dominant airline-direct channel, in Europe or the U.S., without the competitive discipline from online and traditional TAs, and with plenty of opportunity to tack on to quoted ticket prices other fees and charges for “extra services” -- would likely lead to ever-higher overall prices paid by consumers for air travel.
6. The consumer would be placed at risk if a booking were made through a TA who in turn had to purchase from an airline in cash and luggage were lost, or there were another airline non-performance problem. Who would be liable since the ticket form-of-payment would have been cash, even though the traveler would have paid with a credit card?
7. The consumer would be placed at risk in a dispute with an airline that, for example, refused to issue a refund. Today, the consumer can work with his credit card company. Under the proposed new process, the credit card transaction would have been with the TA who paid the airline cash. As such, the consumer would have virtually zero leverage with the airline and would be harmed financially.
8. Unknowingly, consumers would help finance UA and matching carriers' next trips into bankruptcy. A consumer would have no recourse vis-à-vis the airline in the event an airline filed bankruptcy after the TA had acted as merchant because UA and matching airlines would have required the TA to pay them in cash, which the airlines would have received from the TA and not the customer. It is the TA that would be a creditor of the bankrupt airline, not the customer. Under these circumstances, it would appear to be an open question as to whether the customer would have any ability to protest payment to the TA as the TA would not have defaulted and would in fact have fully performed its contract with the consumer by paying cash to UA. The TA, in turn, would not likely be able to enjoy any of the protections the bankruptcy law affords to consumer deposits. So, UA would, in effect, be maximizing its cash on hand in the next Chapter 11 proceeding on the backs of TAs and consumers.
…
Why Consumers Will Pay Substantially More for Air Travel When Travel Agents are Forced to Pay Airline Credit Card Costs
Contact: Kate Hanni 707-337-0328
Stay Tuned for Public Press Release
BACKGROUND
United Airlines (UA) has told many travel agents and signaled its competitors that it will introduce on July 20, 2009 a radical new cost shifting scheme in the U.S. marketplace. If it succeeds, it will represent the most drastic and misguided scheme ever concocted since the airline industry was deregulated in 1978.
UA will endeavor to shift responsibility for payment of credit card merchant fees, an airline cost of sales, to travel agencies (TAs) who will then have virtually no choice but to pass them on to consumers in the form of higher TA service fees, or to absorb them and risk extinction. This is much more nefarious than just a price increase for consumers; it could remove trusted travel advisors from the distribution chain.
The leisure travel consumer, who purchases some 70% of all airline tickets, is a prime target UA plans to (a) extract supra premium prices from over time at united.com, (b) immediately shift substantial financial risk to and (c) exploit to build cash reserves in advance of its next bankruptcy filing.
Just barely a year after U.S. airlines turned irrevocably to charging consumers twice for product features such as baggage and seats already charged for in the price of an airline ticket, UA is now floating as a trial balloon a scheme that would have the consumer pay its credit card costs. Credit card merchant fees are likewise currently baked into the price of a ticket. This comes at a time when leisure fares have begun a double digit ascent. Consumers need to understand how they will be harmed should this unprecedented industry proposal succeed.
This document will provide the relevant facts and key assumptions, and will call out areas of likely negative impact on consumers.
RELEVANT FACTS
1. UA informed an unspecified number of TAs that effective July 20, 2009 they will not be able to sell UA tickets using UA’s credit card merchant agreements.
2. The policy applies to Visa, MasterCard, American Express, Discover, Diner's Club, JCB.
3. TAs would need to establish merchant accounts with the credit card issuers and settle in cash with UA via the Airline Reporting Corporation (ARC).
4. Under this scheme, some $171 million annually in credit card merchant fees could be transferred from UA to TAs.
5. Targeted TAs that continue using UA’s merchant facilities will receive a $75 debit memo for each ticket sold.
6. TAs can avoid merchant fees and debit memos by booking tickets on UA’s website.
7. UA indicated that TAs may have payment and settlement options through GDSs.
8. It is today not feasible for TAs using their own merchant accounts to book through GDSs. When using a consumer's credit card in the GDS, the charge is to airline’s merchant account. As such, the TA would have to sell “as cash” in the GDS, and accept a credit card outside of the normal workflow.
KEY ASSUMPTIONS
1. For competitive reasons, the only way UA can succeed in implementing its policy on July 20 is if virtually every other large airline indicates it will match UA. In short, UA’s pre-announcement of this scheme is both a trial balloon and smoke signal to its competitors. The additional assumptions and projected consumer impacts that follow are predicated upon a successful industry-wide adoption of UA's transfer of its credit card sales costs to TAs.
2. This UA policy is more than just a wholesale transfer of sales-related expenses; it is targeted. UA is not looking to transfer all its merchant fee costs, just those for consumers who use a TA.
3. Many TAs, especially in today’s tight-credit environment, would not likely be approved for merchant agreements involving high volumes of airline tickets. This would be terminal for these TAs.
4. Some TAs with their own merchant accounts would be at risk of losing their agreements because of a substantial increase in average transaction price; their credit limits would be exceeded. Today, TAs generally use their own merchant accounts for only relatively small service fees (e.g., $30) and not ticket sales (e.g., $300).
5. Those TAs approved for merchant agreements may not find the maximum charge volume allowed, or discount-rate levels offered, sufficient or affordable enough to stay in business. This scheme upends established credit relationships in the travel distribution chain and puts processing costs and financial risk in a place where they cannot and should not be borne.
6. Those TAs approved for merchant agreements may find high reserves and holds required by card companies and processors economically unworkable, forcing TAs to service customers using inefficient airline.coms where merchant fees will presumably be avoided; however, soaring administrative costs, plummeting agent productivity and customer service degradation would soon doom these TAs.
7. Well-resourced larger TAs currently possessing their own merchant agreements, or approved for such agreements because of this new airline industry policy, would be forced to pass the new merchant fees on to customers in the form of higher ticketing service fees. What’s more, most TAs today pay significantly higher discount rates than do large airlines.
8. Those TAs attempting to increase cash transactions would find their ARC bond requirements increasing substantially; in the current economic environment many TAs would simply not qualify for higher levels.
9. Ticketing service fees would be driven to even higher levels as TAs' cost of doing business would skyrocket as systems would need to be radically reprogrammed, i.e., this program is as big as Secure Flight in terms of required system changes to GDSs, back office accounting, mid and front office processing and online booking tools; the booking process would be made significantly more cumbersome and costly to execute.
10. The TA instead of being an “agent” would now be the “service provider,” aka the “merchant,” in the eyes of charge card companies. This risk-transfer to TAs would raise a multitude of new obligations and liabilities such as removing protections from TAs when airlines fail to perform.
11. In accepting merchant fee responsibility, TAs tie their very business survival to airlines’ financial viability. In the case of an airline bankruptcy, the consumer credit card transaction would have been with the TA merchant, but the TA would have paid the airline in cash within a matter of days. As such, the consumer could not request that the credit card company reverse the charge, and the TA would have no way to get the cash back from the airline since it would be just another unsecured creditor. Consumers would demand that TAs refund the ticket amount or if the consumer had not yet paid his credit card invoice, refuse to pay the charge. Consequently, a bankrupt airline would in turn cause the bankruptcy and failure of countless TAs, especially in airline dominated hub airport cities -- while being able to keep cash for tickets that it would not fulfill because it either stopped operating or cancelled the service on which the tickets were sold.
12. In an industry where many companies are serial Chapter 11 filers, it is perhaps no accident that under the UA scheme the TAs that had paid cash for ticket sales are not likely to qualify for the bankruptcy protection given to consumer deposits.
13. TAs would have to deal with the financial impact (e.g., higher costs; reduced financial flexibility) of having the necessary capital on hand to transact with ARC in cash.
14. TAs in the U.S. clear transactions with ARC, and as such, they would be on the line for the entire cost of a ticket in the event of charge card fraud, even though the airline is the service provider. Heretofore, since airlines have been the service providers they have had the means and incentives to take action by denying service to travelers involved with verified fraudulent transactions. For example, it is the airline, not the TA that has the chance after telephone or online sales to physically verify the identity of the traveler at time of check in and to refuse service as necessary.
15. Taken together, these negative impacts are lethally discriminatory toward the TA airline ticket distribution channel and would put it at an insurmountable competitive disadvantage vis-a-vis the airline-direct channel. This sets the stage for TA bypass and considerable consumer harm.
INJURIOUS CONSUMER IMPACTS
1. Consumers who continue to use TAs would pay airlines' credit card sales costs, likely finding TA service fees 50% to 100% higher due to merchant fees being passed on as well as systems reprogramming costs and significantly increased TA administrative and process costs.
2. As TAs go out of business, the independent TA channel for airline ticket distribution will have been substantially weakened, diminishing consumers’ access to complete and accurate information regarding air travel alternatives. And once airlines weaken the neutral TA channel, why would we not expect airlines to start charging all consumers who were to book directly with the airline a “credit card convenience” charge? Ironically, airlines would be in a position to justify such a move later on the grounds that “travel agencies do it.” In any event, there can be no doubt that consumers would pay unnecessarily higher airfares.
3. Better-financed TAs would be able to raise service fees even higher while offering less customer service, especially for those consumers who do not have access to the Internet or who are otherwise uncomfortable with online financial transactions or navigating complex airline websites. The UA move, if matched, would lead to more consolidation and more failures of TAs.
4. New merchant fees and additional costs would create a material price gap between the total-cost of a ticket booked via a TA versus at airline.com. Especially in a recession, unsuspecting consumers would be enticed to airline.com by perceived lower fares, and perhaps short-term inducements, but where the absence of comparison shopping and unbiased, expert TA advice would lead to higher fares paid.
5. As investigated and disclosed by the European Commission last year, the majority of airlines operating in Europe had websites that were misleading and deceptive in the way fare information was displayed. A dominant airline-direct channel, in Europe or the U.S., without the competitive discipline from online and traditional TAs, and with plenty of opportunity to tack on to quoted ticket prices other fees and charges for “extra services” -- would likely lead to ever-higher overall prices paid by consumers for air travel.
6. The consumer would be placed at risk if a booking were made through a TA who in turn had to purchase from an airline in cash and luggage were lost, or there were another airline non-performance problem. Who would be liable since the ticket form-of-payment would have been cash, even though the traveler would have paid with a credit card?
7. The consumer would be placed at risk in a dispute with an airline that, for example, refused to issue a refund. Today, the consumer can work with his credit card company. Under the proposed new process, the credit card transaction would have been with the TA who paid the airline cash. As such, the consumer would have virtually zero leverage with the airline and would be harmed financially.
8. Unknowingly, consumers would help finance UA and matching carriers' next trips into bankruptcy. A consumer would have no recourse vis-à-vis the airline in the event an airline filed bankruptcy after the TA had acted as merchant because UA and matching airlines would have required the TA to pay them in cash, which the airlines would have received from the TA and not the customer. It is the TA that would be a creditor of the bankrupt airline, not the customer. Under these circumstances, it would appear to be an open question as to whether the customer would have any ability to protest payment to the TA as the TA would not have defaulted and would in fact have fully performed its contract with the consumer by paying cash to UA. The TA, in turn, would not likely be able to enjoy any of the protections the bankruptcy law affords to consumer deposits. So, UA would, in effect, be maximizing its cash on hand in the next Chapter 11 proceeding on the backs of TAs and consumers.
…
Subscribe to:
Posts (Atom)
