The company mentioned in the article as the provider of this technology, Volantio, is the entity that was previously called Adioso, which was in YC in 2009. Some HN readers may remember some blog posts I wrote a few years ago about the struggles we went through.
If you ever wondered what happened to Adioso, well, here's part of the answer. The company took the insights and technology assets it had developed for the consumer market and turned them into enterprise services to offer to airlines, and that has been the focus for the past 3-4 years.
As evidenced by this breakthrough, it has turned out to be a very good move.
The original Adioso product still exists but in a different entity, and its current status is best described as side-project. I'm still optimistic that the original vision we had for Adioso as a consumer product will be realised, but it will end up looking very different to what it's been to date.
In the meantime, it's extremely pleasing to see Volantio making such an impact.
Given you know the market well, how would you find a cheap destination given two different places of departure?
For example, you live in country A and your special someone lives in country B, and you want to list countries C and airports in order of smallest sum of two return tickets.
Is there an api that flight search websites use, which you can get access to? Or are there already websites offering such a feature?
The closest to an API which aggregates all flights is a Global Distribution System (GDS), of which there are three in common use. Airlines publish their inventory on the GDS and travel agents book through them.
There are some exceptions. GDS cost money so budget airlines usually don't bother with them. In that case, they may publish an API which agents may consume, or the agent may screen scrape them.
Adioso is amazing! Lots of people cite SkyScanner as their favorite site to search for flights, but you guys really take the pain out booking, since you optimize for price, hops, layover time, etc. Thanks :)
Strangely enough, I was just talking to someone here in Berlin last night about Adioso, and was wondering what happened to it. Good to see you guys still going, albeit in a new form.
I don't really understand the reasoning behind overselling seats. Every time I hear it happen when passing though the USA I am reminded of the Seinfeld line,
"You know how to take the reservation, but not how to hold the reservation."
Clearly there is some sort of profit motive for the airlines, but how can this be legal. It seems wrong to oversell a limited resource like this. Even if not legal it feels scammy on the lines of "upto" speeds for ISP's.
Say you're an airline, and you notice that all your planes get fully booked, but on every flight, 2 to 5 passengers do not turn up or miss their flight.
That means that you can easily sell 2 extra tickets for each flight. That's free money (as good as; fuel consumption will go up a tiny bit)
Now, there's the rare case where too many passengers turn up. So, you pick out a college student or backpacker who is happy to take a flight an hour later in exchange for money, a free ticket for another flight, or whatever. That costs you a bit, but as long as it is rare enough, the net result still is extra money, and, ideally, everybody is happy.
Airlines have departments that compute the ideal amount of overbooking.
So, how can it be legal? That's easy; if you book a flight, you accept terms and conditions, and no government has seen reason to make it illegal.
It should not be legal and probably isn't really. It is a basic morality thing? Contracts should be fair. If you book a flight then it should be clear your booking is subject to availability. If it is subject to availability then to maintain the principle of contractual reciprocity you should be able to cancel without incurring a charge as you too are 'subject to availability'. Currently it is not fair. They should not be overbooking fixed seats and expect people to help them out for bribes no less to the implied 'desperate for money' college student or a backpacker. What a disgusting world view that encourages. As to those who were subjected to violence and forcibly ejected - they should be able to sue for eye-watering punitive damages in the tens of millions (money being something so dear).
I think the current system actually meets your criteria for fairness quite well.
First, at this point it's reasonable to expect passengers in the US to know that their booking is subject to availability in some limited number of edge cases. It's not particularly common but it's also very public knowledge that it sometime does happen.
Second, both parties have a cost to rebook - passengers pay a rebooking fee, airlines pay a bump fee (in a voucher if the passenger is foolish enough to accept that). Additionally, the rebooking fee for a passenger is significantly lower as a % of ticket cost than it is for the airline.
>...First, at this point it's reasonable to expect passengers in the US to know that their booking is subject to availability
I question that. My guess is that the vast majority of the people who get a seat assignment when they book, never consider the possibility it might be taken from them. Most of the time, people are conditioned to not want to cause a scene, but I can bet no one is too happy about it when a breach of contract happens.
Airlines are unique in that lots of people go along with this. If you sign a lease to rent your house to someone and on the day they arrive with their moving truck you tell them you decided to lease it to your brother, there is a good chance you will end up in court.
> but I can bet no one is too happy about it when a breach of contract happens.
It's very odd that you consider this a breach of contract, because these contracts are pretty heavily policed by regulators and the courts. Check every ticket you've bought, the contract of carriage includes terms specifically about overbooking.
For instance, here's United's Rule 4G:
All of UA’s flights are subject to overbooking which could result in UA’s inability to provide previously confirmed reserved space for a given flight or for the class of service reserved. In that event, UA’s obligation to the Passenger is governed by Rule 25.
>It's very odd that you consider this a breach of contract,
You are partially right in the sense of the one-sided document that they impose on their customers, they reserve the right to not let you board. In the case of the United passenger (and many others that came to light after this assault) the person had already boarded. At that point, the reasons for not transporting (Rule 21) are spelled out and they don't include reasons like ("we decided to use the seat for our employee" or "a gold member wants the seat"), etc.
>...because these contracts are pretty heavily policed by regulators and the courts.
The idea of involuntary bumping should probably be viewed as regulatory capture. We don't allow that in other industries.
I never knew that they overbooked flights until recently. From my perspective, it appeared obviously wrong and immoral. So never imagined that an ethical company would do this.
while no fan of the system at all, there is a certain amount of reciprocity. Either you voluntarily accept an inducement to fly at a different time or you get paid ~0-400%[1] of the one way fare of the flight you got kicked off of plus they still need to fly you there. I personally think that number is too low...
I don't even see a problem with the concept, although customers should clearly be more aware of the precise terms. It's certainly no worse in principle than, say, fractional reserve banking. And obviously no one should end up with a bloody face.
They're already getting the profit. If the flight was fully booked and someone didn't show up, that seat was still paid for. To me, it really should have been reserved for that passenger, present or not. Reselling a no-show's seat is double dipping on profits.
Think so? That's a naive view of business. You know what airline doesn't oversell flights? JetBlue. You know which airline doesn't turn a profit? United. Weirdly, JetBlue is profitable though.
I wouldn't envy the marketing and pricing analysts in that situation trying to optimize. Imagine seeing an option at checkout to upgrade to a "no-bump" seat? Or the reverse, you can opt-in to a "bumpable" seat for a discount. Actually, the latter doesn't sound so bad for casual flights!
WestJet here in Canada is currently running ads emphasizing that they never overbook their plans. The ads have been very effective and I suspect that the increased business has more than made up for any gain they could have made from overbooking.
Yes, but they have no right to that money in the first place, since their physical plane does not fit the extra customers. They have already got all the money available from the flight. Plus, every no-show is pure profit already since their luggage needs no handling and there's no fuel consumed for hauling them.
I guess the only way to force them out of this habit would be to make the compensation mandatory at 10x the ticket price, in cash, on the spot. And a seat on the next plane, plus free accomodation for the bumped person if the next plane is more than 8 hours away.
Depending on the numbers, I will accept some very small risk of being bumped to a later flight in exchange for cheaper tickets.
Also a bonus if overbooking helps keep the route to the rinky-dink airport in my hometown operating so that I don't have to drive in for the last leg of my holiday trips.
Else we can ask what about those who can't afford an airplane ticket at all? Perhaps nobody should ever fly since we can't assume that these people don't have important plans either?
>Their plans less important because they can't afford the no-bump class?
No, but their purchase power is clearly less -- which is what determines what one buys (and if one can afford to fly in the first place), not the importance of their plans.
(The only place where the argument holds is in things like organ transplant waiting lists, which we don't want to turn into a market -- and we'd be less hypocritical if we extended it into general free/same-price healthcare for all).
I really can't understand this comment. I have a friend whose dream it is to go to Japan but can't afford the cost. Should airlines lower the cost flights just so her and her family can afford to buy tickets?
Anyways, the bumping situation only would come up rarely, most oversold flights don't have to bump anyone and usually oversold flights have volunteers before they have to involuntary bump someone.
The question has nothing to do with an entirely optional vacation. You've bought a ticket for a funeral, a job interview, etc. Why should it be ok for the airlines to bump you off your flight when you have bought a ticket? Just so they can make a little bit more money when people occasionally don't show up?
To be fair. Involuntary bumping is happening very rarely.
Airlines don't have an interest to bump passengers. At least in Europe this can be relatively costly as in up to 600EUR compensation per passenger. Add hotel rooms, multiple restaurant visits, taxis and communication costs to that. Add the image loss if this happens too frequently.
Airlines employ extremely complex math and statistical models to avoid bumping passengers, while filling the plane to capacity and mostly it works out. If it doesn't they usually find volounteers, who are willing to be bumped, provided that they are fairly compensated and provided with a reasonable alternative.
What if you can't afford a plane ticket to attend a funeral? Should airlines give you one? Without overselling flights travel would cost more for everybody (at least in theory).
Job interviews are readily rescheduled if you're bumped against your will.
Airlines already have bereavement flights that give the bereaved priority and extra flexibility.
We already have regulations that compensate people who are bumped against their will so it's not in the airlines best interest to do so, it's expensive.
BTW, my mom missed her dad's funeral due to the 1981 air traffic controller strike.
I can't afford to buy a Ferrari, however I would really like to have one. Does my need is less important than a need of those who can afford it? Does this mean that now all Ferraris should cost (let's say) $1000?
That's patently untrue. The USA and other countries in fact specifically have laws and regulations covering how airlines must handle overbooking situations.
Thanks but it still didn't explain why it is legal. It just said it was standard procedure. Sure there are laws covering overbooking situation but that doesn't mean the actual idea of overbooking has gone through legal scrutiny.
Not only is it specifically legal, the regulations actually state that airlines have to give passengers a pamphlet spelling out their legal rights if bumped, and how much a passenger must be compensated if they are bumped. If it were illegal, don't you think the pamphlet would say "hey, the airline can't do this to you?"
What kind of legal scrutiny are you looking for? And do you not think that, among the tens of thousands of passengers who are involuntarily bumped in a year, not one of them would have challenged this in court by now?
I see nothing wrong with it as long as they pay bumped passengers enough to secure their consent.
Where it becomes a problem is when the airline decides they don't want to pay "too much" and start bumping people involuntarily. That should be illegal. If a flight is oversold and nobody will accept being bumped for less than $10,000, then the airline should have to pay $10,000 to resolve the situation.
As it stands right now, the whole thing is skewed in the airlines' favor because they have a nice, low cap on payouts.
I think the problem is that the passengers can collude to take the airline's money hostage, since this turns into an unregulated auction of sorts.
One person is willing to take $10,000? Great. Every other passenger is willing to refuse $9999 for the low price of $9999. Now, each passenger needs a 1/Nth of the payout, and that fraction needs to be >$10,000.
Now the negotiation's starting offer becomes: "You overbooked by one seat. How much will it cost you to ground the plane, or fly it empty and bump us all to other flights? Give us that much money."
Honestly, this outcome would be fine by me, since it would correct poor airline behavior pretty rapidly. They already let you buy standby tickets; overbooking is double dipping.
Yeah, I doubt the people paying $200 each way on a trans-US flight are going to hold out for $10,000. Once you're at 5-10x of your ticket price, people who actually have flexible schedules are going to be pretty interested. On most overbooked flights this needs to attract <5 people, so hard to imagine the passengers taking "the airline's money hostage".
The problem is, risk management for big corporations still requires these kinds of guarantees against such events, improbable though they may be, in order to quantify the downside. There's a big difference between:
1) "Come on, you can't get 100 people to collude." vs
2) "There is a law that ensures our per-passenger liability saturates at $1350 plus re-booking costs."
For similar reasons, they insure against a hundred different possibilities and require low-personal-judgment protocols to comply with the policy terms.
So pay some trivial amount for insurance and let the insurance companies quantify the risk. Or refrain from overbooking. I see no problems here, just different solutions.
Insurance would be pointless for this problem. Insurers aren't magic risk-vanishers; they'd still specify an upper bound on their payout, leaving the airline with the unbounded amount, but the entire problem here is to upper-bound the downside!
That only leaves a) a law saturating the liability, or b) a contractual provision (and law validating such provisions) that saturates the liability. It still would explicitly prevent the possibility of colluders extracting an unbounded amount to be bumped.
You could buy an insurance policy that caps at, say, $100 billion, and then plan to go out of business if it somehow takes more than that to buy out someone's seat.
Or you could avoid that Rube Goldberg and just pay what it takes. The risk of a multi-million-dollar payout for a few oversold seats is lower than the risk of, say, being put out of business because your negligence caused one of your aircraft to crash into Manhattan and you end up being liable for tens of billions in damages.
Everyone has a price they would be willing to give up their seat and it will be different than the person next to them. If you are traveling on a last minute ticket to visit a family member in the hospital, you might not be willing to delay your travel for any amount of money. If you are traveling on a vacation, the amount might be relatively little. Also some passengers will value some things more than others - offering a year of gold membership might entice a business traveller, offering money might entice a college student, upgrades to first class might entice others, etc. The idea that 100 people have the same utility curves is not reasonable.
Obviously it is more efficient for everyone if this bidding is done before you get to the airport, the system described in the article is one example.
Because on every flight, a certain percentage of people don't show up, and certain number of passengers are on "flexible" tickets, that can be transferred to a different flight even very soon before departure.
By overbooking, the airline can ensure that all seats are occupied, which means more people get to their destinations when they want to, and the cost-per-passenger is lower (as fares don't have to include the overhead cost of empty seats).
Most of the time their forecasts are accurate and the system works well for everyone. But occasionally their combination of forecasting, incentives to transfer and customer service practices go wrong, resulting in the horrible incidents we've heard so much about.
This. (Disclosure: I'm co-founder of Adioso/Volantio btw)
Just confirming the above: The no-show rate is actually relatively stable in _most_ cases, which is why airlines try and optimize for this by selling past physical aircraft capacity.
In some markets it's illegal, in which case the average airfares are often notably higher.
This can have a more extreme effect than is immediately obvious: Because "last minute" fares (the ones that often fill up the aircraft) are usually the highest price and are critical in how airlines are able to make flights profitable.
Additionally, the most common no-shows are those who have booked early (the cheap tickets), meaning oversell allows the airlines to make space for urgent last minute travellers when the earlier ones don't turn up.
Without catering for no-show, it's feasible that air fares could end up a LOT more expensive (potentially 20%+) to remain profitable, depending on the distribution of prices in the demand curve leading up to departure.
You can certainly not do it, but on average, customers end up worse off (and the market is relatively good at optimizing this).
The biggest problem (in our mind) is that airlines don't have a good "safety valve" in cases where things go wrong. That's what we (attempt to) fix.
The airlines do have a good safety valve: offering people increasing amounts of money (not vouchers, but actual currency) until they get enough passengers who prefer the money to traveling on that flight. They just don't want to use it.
It's a little more nuanced than this. Gate auctions are a good solution, but can only happen in the last ~15-20 minutes prior to departure, which leads to "too late" scenarios as everyone is already present/committed to travelling.
Oversell is sometimes known with high confidence at checkin-close (1 hour prior to departure) or even before, due to the fact that oversell thresholds can change throughout the booking curve.
Airlines don't have a current solution to rebalance/correct loads prior to the gate auction.
I can certainly see why they'd want to get people on a different flight as early as possible. This article just has a weird tone as if overbooking is a huge problem and the airlines are stuck with involuntary bumping unless they can figure out some novel technique.
They could stop selling the really cheap seats so far in advance which puts them in the situation of trying to scramble for last minute bookings to make it profitable.
In the USA, nearly all airfares are changeable, even those that are sold as "non-changeable". In Europe, that's different -- the lowest fare class is often "use it or lose it", with the ticket becoming worthless if you don't get on the flight you booked. If you want to stop airlines from overbooking, then you need to stop travelers from changing their plans and leaving seats empty on the plane.
You can talk about overbooking as "profit motive" for the airline, but airlines traditionally make very low margins. Air travel is a classic oligopoly, where a large number of competitors offer goods that are practically indistinguishable (Coke vs. Pepsi, Shell vs. Exxon, United vs. Delta) -- these industries are characterized by fierce price competition. Ultimately, any decrease in revenue from one source will be reflected in higher average ticket prices.
An airline industry that didn't overbook would be one where either everyone pays significantly more for their tickets, or where most tickets become truly non-changeable, as in you have to buy a totally new ticket if you change your travel date or time.
Honestly, a system like this, where the airline can do yield management transparently, days or weeks before departure, when people have time to weigh their options and make alternate plans, makes tremendous sense and does a lot to allocate costs to those who are willing to pay, keeping things less expensive for those who aren't.
What are you talking about? Every US ticket I've bought has been non-refundable. I even tried notifying one that I wouldn't be using it as a courtesy and they were like "why are you calling? You can't get a refund and we don't care that you're not coming."
And of course there's a middle ground: being upfront about which seats are really reserved, and what you can expect for not-really-reserved seats on overbooking. None of this "oh you should have done research to realize what your rights and minimumn payment are and that this voucher is worthless".
Eliminating overbooking is overkill and some people are in fact confused on that matter. But please don't pretend the only alternative is some apocalypse.
I don't know which tickets you are buying, but I fly ~ 150,000 miles per year, all on non-refundable tickets. I change my plans ALL THE TIME, and those tickets are always credited to my account. I have to re-use them within 12 months, and the airline deducts a change fee from the value before making the deposit.
My work travel system even has a built-in tracking and reminder system for ticket vouchers that will nudge me to fly on a particular airline if I have a credit with them.
And, I will say this -- in nearly all situations, if an airline thinks they may need to involuntarily bump you, they won't assign you a seat. Once you have picked a seat on their reservation system, you have a very low chance of being bumped involuntarily. Once you have a boarding pass with a seat number on it, I'd guess that the odds are 100,000:1 that you're not going to get on board (unless you volunteer to take a voucher). All the more reason that the infamous United dragging incident was some kind of anti-unicorn (which wasn't about over-sold seats, after all -- it was about needing to accommodate a non-revenue flight crew).
So you're saying an airline that you fly 150,000 miles a year on treats you like a valuable customer? It works a little differently for the average Joe without elite status.
I go years and years between flights, and I had the same experience when I canceled. 80% of the ticket price was credited to me as long as I used it within a year.
No, I'm not saying that at all. First of all, I fly across many airlines, some of which I only fly once per year. Second, the ability to bank my un-used tickets has nothing to do with my frequent flier status, it's available to any passenger -- and I have used it on airlines that I have flown very infrequently (one in particular that I flew once and only once because they pissed me off so much that I let the credit lapse rather than fly them again, but that's a longer story), so I'm sure this is true.
Do I get special treatment on the airline I fly most? Yes, I do. I've been able to change tickets on that airline without a change fee as a courtesy on multiple occasions, in contradiction to their printed policies.
Airlines have been sneaking in newer lower tier ticket levels that exclude any sort of refunds or changes. You probably don't run into these through corporate travel, but if you have a basic fare your ticket is use it or lose it.
Yes, true, but those have all come online within the past 6 months or so (led, I think, by United, and then quickly copied by the other major carriers), and are still relatively rare even for leisure travel, at least in my experience. Unfortunately, I fear that you are right that they will take over the lowest end of the market.
I can't/won't book these for leisure travel, because they don't even allow you to sit with your family members.
Honestly, the recent penetration of basic economy into the US market is something I'm much more concerned about than involuntary bumping. If the airlines are successful, then they're just going to re-set the baseline for standard economy up by $100 or so a ticket. Planes were already full, it's not like they are going to increase revenue by offering cheaper tickets, they're just going to get away by giving you less for your money.
I agree, and I never said differently. Almost all US tickets are non-refundable, and have been forever. Likewise, almost all US tickets are changeable FOR A FEE, which I said pretty high up in the thread -- and the airlines are pretty flexible on what constitutes a change (you can pretty much book a new ticket for yourself within a year, after they deduct the fee).
Please tell me which US airline other than Southwest gives a full refund (even if it's in the form of airline credit) on a no-frills basic economy ticket to a passenger without special status after 24 hrs of booking the ticket.
The last I checked most of them charge change fee to the tune of 150-200 dollars. Moreover, if you get it in the form of airline credits it's further restricted in the sense that the credit is available only to the person under whose name the ticket was booked. So if I book tickets for my daughter and pay for them and have to cancel them, I can't use that money other than to buy a ticket for my daughter on the same airline in the next 12 months.
In the comment you are replying to, I specifically said "I have to re-use them within 12 months, and the airline deducts a change fee from the value before making the deposit." Changeable with a fee is not the same as non-changeable. Yes, there's a penalty, but if the original ticket was $500, you can still re-use more than half of the value.
Even on fully changeable tickets, with no fee, you can't assign them to another passenger. You'd have to have a refundable ticket, get the refund, and then buy another ticket.
> In the USA, nearly all airfares are changeable, even those that are sold as "non-changeable".
The vast majority of tickets sold in the USA have restrictions on changes.
> An airline industry that didn't overbook would be one where either everyone pays significantly more for their tickets, or where most tickets become truly non-changeable, as in you have to buy a totally new ticket if you change your travel date or time.
This is a legacy from time long past and it wasn't the best decision back then. If you put a little thought into most airline policies you can come up with something that is both more effective and provides a better customer experience while reducing costs or increasing profits.
There is simply not enough competition in the industry to force change.
I've never heard a rational justification for overbooking except that it allows airlines to sell more tickets than they have seats. On most airlines non-refundable fares have a change fee which cover the fuel costs in the event of a no-show. Southwest is the only one that does it right- their refundable fares have enough margin built in to cover no-show costs without change fees.
There is nothing inherently wrong with the idea of overbooking as it allows for more efficient use of planes, but if the airlines screws up and has too many passengers at the time the flight is to leave, involuntary bumping should not be allowed - it is the airline's responsibility to fulfill their contract. If they think paying people to give up their seat would be too expensive, they shouldn't overbook.
I agree the system in the article sounds like a good start - making more efficient use of planes is better for everyone.
The reasoning is that some people cancel their reservations, so if you have a good statistic for how often that happens you can overbook to take up the slack and still have a full plane. Airliner margins are pretty thin, so they jump at opportunities to avoid "waste" like this.
Scammy? Ehhh. People get way more than their money back for switching flights, which I consider enough to make it un-scammy. Others might reasonably disagree.
To be more accurate: It's less about cancelled reservations, but mostly about no-shows.
People buying full-fare tickets don't incur a penalty if they just don't show up for the flight. Most tickets, nowadays are anyway non-cancellable (except, sometimes for a hefty fee) and non-refundable.
At times the flight from Tel Aviv to Zurich could be overbooked by as muchas 60 seats. I know this because my sister worked at (now defunct) Swissair.
Personally I don't feel this to be a scammy concept, provided that the airline
- Rebooks you onto the next available flight. If necessary with a competitor and
- Compensates fairly and in cash and coughs up for hotel acommodation, transportation and food if necessary
Plus even non-cancellable tickets can be moved for ~150 dollar fee. And most airlines will let you fly standby if you arrive too late for your flight, at no cost.
If they didn't do overbooking, then missing your flight is a huge opportunity cost of them. They wouldn't be so quick to let you just move it last minute or fly standby.
The real problem with that united PR debacle was that the passenger was roughed up by security. But overbooking is probably a positive for flyers.
The United flight wasn't even overbooked either, all paying passengers had a seat. They booted paying passengers for crew members.
IMO the correct thing to do is do everything they can do to find alternative arrangements for crew member transportation in that case. I think paying customers should be the priority.
Another mistake made was allowing the passenger to board and then removing him. Bumped passengers should not be allowed to board in the first place.
They argued that this would result into a cancelled flight the next morning if they wouldn't have flown the crew, since no crew would be available. This may, or may not be the case. But if it really was that urgent they could have chartered a private plance for the crew. At ~300 miles even renting a car may have been feasible (this may have cut into the mandatory rest period of the crew, though).
Another mistake made was allowing the passenger to board and then removing him
Precisely that! You just can't have paying passengers board a plane to then kick them out. If the flight is really oversold you should find volounteers at the gate and - if necessary - auction the bumping off. If nobody wants to be bumped for 800$ then raise the price. It's not my impression that they really did that. They just selected four passengers, stormed the plane and essentially told them "off!" When Dr. Dao refused (which I can understand, if you have patients potentially waiting for month to get to see the doctor) they gave him the "Nice face, would be a shame if something happens to it" treatment.
Oh, and offering the amount in cash and not in some vouchers, which probably come with so much fine print and restrictions to be virtually useless would probably help too.
Right, I think that the right thing to do was either pay to book the crew members with another airline (or private plane) or rent them a car. People have also said hiring a limo to transport that distance cost about a thousand, I don't know if that is true or not though, I've never hired a limo.
Thing is, I'm not sure those arrangements were actually considered by United though, they seem very short sided in general.
I didn't really consider resting times might be an issue though.
The important part is don't board a passenger THEN kick them off. If they are bumped, they shouldn't ever board.
> Because your last minute business traveler who is paying a big chunk of cash doesn't want standby.
So what I'm hearing is that they'd rather be lied to at the airport, than at the time they're buying the ticket.
If you buy a ticket, then there should be no reason for the airline to deny you boarding (excepting safety issues). This is how every other service works.
If I turn up and it turns out so did everyone else who bought a ticket, then the airline should not be bullshitting about overbooking.
That sounds like a very small number, but that equates to about 126 people per day in the US alone. For some this might have been an inconvenience, but for others might be closer to a catastrophe depending on the reasons for their travel.
No, that only limits how up they HAVE to go - past that they have no obligation. If you get denied boarding and they have not reached the 400% / $1350 offer, you have legal recourse.
They are absolutely not forbidden from offering more if they choose to - this is actually even explicitly mentioned in the regulations. The legalese is not super easy to parse, but this link makes a decent attempt at explaining it: https://www.dailykos.com/stories/2017/4/11/1652290/-The-Wide...
Q: Is the amount an airline must offer involuntarily bumped passengers arriving on a substitute flight over 2 hours after their original flight still 400% of the one-way fare, for a maximum of $1,350?
A: Yes, an airline must offer 400% of the one-way fare up to $1350 to involuntarily bumped passengers arriving on a substitute flight over two hours after the planned arrival time of their original domestic flight. Airlines are free to offer involuntarily bumped passengers more money than required.
That's only for passengers bumped involuntarily. If the passenger agrees to be bumped - i.e. it's not involuntary - the compensation can be any amount.
The 400% minimum compensation only applies if the airline chooses not to offer enough for anyone to volunteer.
Rather, allow people to buy "don't-kick-me" tickets for a bigger price and once the plane has been filled with don't-kick-mes, notify all other ticket holders that they're being bumped to a later flight. If any don't-kick-mes don't show, the waste is covered by the increased price.
But there is really no waste when they sell out 100% of the seats. If people no-show the seat is paid for.
The airlines are trying to make it sounds like they are just trying to reach 100% capacity but in reality they are trying to arbitrage the fact that a few people buy non-refundable tickets and don't show up.
If I had exactly 100 widgets to sell, I can't take payment for 105 in the hope that at least 5 people won't show up to collect their purchases. That would be straight up fraud as I am knowingly taking payment for goods or services I know I can't provide to some of my customers. If it happened as a one-off accident then of course I can give refunds and offer something in compensation, but if I make a habit of it then the authorities would almost certainly start feeling my collar.
Even allowing for the complex financials and T&Cs of the airline industry I really struggle to see how this is acceptable. If it in any other industry people would be arrested.
> If it in any other industry people would be arrested.
Hotels and cruise ships (at the least) do exactly the same thing. They're all essentially gambling, and they win most of the time, so people don't really get angry enough to make an issue of it.
Short but annoying answer -- you are not buying a widget, you are executing a contract of carriage with an airline, governed by a multi-page written contract and hundreds if not thousands of pages of associated government regulations.
That contract gives both you and the airline a number of very specific performance requirements, and also a bunch of outs in situations like weather delays.
To get into the longer answer -- seats on a plane are a special kind of commodity, because they become completely worthless the minute the door closes. If you really want to treat them as widgets, 99.999% of the time the result will be worse for the airline (they fly a plane with empty seats, which they do not get paid for), and worse for the consumer (people don't get where they want to go, because planes are taking off with empty seats).
I will argue that a world where airlines overbook, we all get lower fares and better flight availability, passengers can change their tickets with nominal penalties, significantly less than 1% of passengers are compensated to change their flight plans, and 0.007% of passengers (that's 7 people out of 100,000) are involuntarily bumped with compensation (source: https://www.dallasnews.com/business/airlines/2017/03/20/hold...) is better than the alternative.
>Short but annoying answer -- you are not buying a widget, you are executing a contract of carriage with an airline, governed by a multi-page written contract and hundreds if not thousands of pages of associated government regulations.
But that is itself a problem: that they're banking on you not knowing your rights because the exact terms are so complicated.
It would be a different matter if each purchase made it explicit:
"This is really just a standby ticket with an X% chance of having to bump you, in which case you are paid $Y and booked on the next flight. To convert to a true reservation you may pay $Z."
Overbooking is not the only reason that airlines have to deny boarding. Sometimes, they end up making an aircraft change. Sometimes, headwinds dictate that they have to lower their weight. Sometimes (as in the now-infamous United case), they decide that they need those seats to carry crew. Sometimes, a seat is broken, and they can't use it.
JetBlue is an airline that does not oversell seats (Southwest apparently also decided to join them in that practice this year -- my guess is that their unique no-assigned-seats boarding method gives them a lot more flexibility). Despite that, in 2016, they had one of the highest rates in the industry of forcibly denied boarding, significantly above the industry average. (source: https://www.fool.com/investing/2017/04/16/1-us-airline-never...). Each and every one of those had one of those "true reservation, it's not a standby ticket" tickets that you're talking about.
Practically, when picking who to deny boarding to, airlines have some pretty clear rules. If you want to be sure you're going to get a seat, pick one for yourself when you make your reservation, check in as early as possible, and buy a refundable ticket.
> If I had exactly 100 widgets to sell, I can't take payment for 105 in the hope that at least 5 people won't show up to collect their purchases. That would be straight up fraud
People do this all of the time...
It's called accepting orders prior to manufacture. Most of the time it works out. When it doesn't, you deal with the consequences.
And even if you lied to the customer, you just tell them you had manufacturing delays. And either refund them, or up-sell them to another product.
The only reason we don't see this behavior in the news is that companies typically don't physically assault customers who have bought widgets that can't be delivered.
Think this way, if you have 100 widgets you promised to be delivered in a week, and you know you will have another 100 widgets coming in stock next week, would you take payment for 105 or more today, hoping at least 5 people do not mind to wait to get their widgets a little later?
That's Okay because it is your genuine intention to fulfill your obligations. If you don't have enough widgets you can just order more, all orders will be fulfilled eventually.
But flights are different. There is a hard limit on availability, plus most bookings are time sensitive. There are only a a certain number of seats available on each flight. You might be fine with being moved on to a later flight, but then again you might not. If you book and pay for a specific flight you should have every right to assume that the seat is yours.
But those people are still flying, for the most part. If the airline sells five extra seats and five people delay their flight for a day, it's not like they're selling something they don't have to provide.
That's standard operating procedure in the software industry. If I had a nickel for every time a salesman sold a feature that our software doesn't yet have...
Sometimes people miss flights, or last minute cancel, for various reasons. If past statistics show the every 200 seats plane has 10 no-show passengers at departure on average, you can sell 210 tickets in average and depart with every seat occupied. Hotels do it too, and many more industries.
I used to work front desk for a hotel and we never oversold our capacity. In fact, we would normally block a few of our rooms from being able to be reserved in case of unexpected maintenance issues. If no maintenance issues arose we would sell those rooms to walk-ins.
I can't imagine working someplace where, as a matter of course, people with reservations are turned away due to overbooking. It's likely that such a place would not last very long either, because as soon as people read TripAdvisor reviews about how your property doesn't honor its reservations they will stay elsewhere.
Hotels routinely oversell capacity - when this happens they just walk customers to comparable hotel nearby. Not sure why hotel you worked in did not do it.
Unfortunately this is _not_ what airlines do. They work very hard to book you on one of _their_ next available flights. I think that by law they should be required to book you on the next available flight by any airline in any class and additionally pay fines depending upon how long the passenger is delayed. They should also be required to make their best effort to find the available seats for the passenger.
What you're asking for already exists pretty much in the US under DoT regulations.
If you are removed involuntarily (not asked to switch for a certificate) you're entitled to up to 400% of your one way fare up to $1350 cash in hand on top rebooking you, depending how long you got held up. [1] Theyre also required to show you your rights on paper in that situation. It almost never happens because there's a huge incentive for them not to do this to you.
And if you think that's rough check out EC 261/2004 [2] and that applies even in the case or a mechanical issue.
I should have made clear I know that some of the rights already exist, but this was really my most important point:
> They should also be required to make their best effort to find the available seats for the passenger.
In other words, it should be their responsibility to get you re-booked immediately on all available flights. This should be something that should be verifiable afterwards (i.e. if you as a customer find out they didn't send you on a certain flight by another airline that was better, that should mean additional fines). This should be strongly enforced by regulators to the point where it actually occurs.
Unless I'm missing something (didn't see it in [1]), those rules/enforcement are not currently place. Under these circumstances, I could _maybe_ accept overbooking as an acceptable practice, but without them I don't see why it should be acceptable.
My suggestion is that in the phrasing of the regulation, the longer they wait to get you home the more money they owe you, and that's sort of a built-in enforcement mechanism for them to send you home on the next available flight instead of their next available flight (cash goes from $0 to $1350 over the span of 6 hours) and IMO that's a positive market force thats stronger than any enforcement action, although if you think your rights have been violated feel free to file a complaint against the airline with the DoT.
I have no moral argument against overbooking, its wasteful for them not to do so if their projections show that without it, the seat would go out empty. Sometimes they mess it up, sure, and in those cases they owe you cold hard cash, hotel accommodation IIRC and a flight to your destination anyways. Between the monetary outlay and the social media feedback, as a very frequent traveler (top tier with AA and Alaska this year, that's 190,000 qualifying miles), I feel quite satisfied with the status quo.
Per [1] in 2015, only 0.09% of passengers were denied boarding voluntarily or involuntarily. Involuntarily denied boarding accounts for only 0.0075% (43 out of 613,141) of boarded passengers -- that's four nines -- and my understanding is 2016 performance was even better. You were almost as likely to be hit by lightning each year (1 in 700,000). With those kind of performance metrics, it feels like things are working, or else we need to really get our act together re: lightning strikes :)
I think hotels have cut back drastically on this, now that most reservations are guaranteed with a credit card. At some magic hour, say 5PM, they charge everyone's credit card for the night whether they checked in or not. For most of the reservations I've made in the past year, the cancellation period is actually one day prior to arrival.
In years of business travel, where I frequently arrive at the hotel at midnight, I've only been walked three times. Once at a trade show, where the hotel was renovating and didn't get the rooms done on schedule. Second, where a guest got ill and was unable to depart on schedule. Third, on a trip to New York, where they walked me to a sister property located literally across the street (I got the feeling that these two hotels frequently traded guests).
I spend about 100 nights a year in hotels and I've maybe had a hotel not have a reserved room for me once in ten or more years.
>the cancellation period is actually one day prior to arrival
Unfortunately, a lot of chains are increasing their cancellation window. In addition, there seems to be a fairly significant trend toward hotels (especially the chains) offering substantial discounts for non-cancelable reservations.
This. Ditto. "Maintenance rooms" are like Broadway's Rush tickets.
Even most sold out hotels have maintenance rooms. Sometimes the only reason it is in "maintenance" is something simple. And could be rented last minute (as i did in similar job)
No, when it happens they find you another hotel room in a nearby hotel and either drive you there or have you driven there on a cab.
But is not at all common, and when it happens it is more likely that the reason is not overbooking, but rather some incident (like a mistake in the bookings, a bathroom found leaking just before the customer arrival, a couple that booked a twin and then arrived with a 17 year old "kid", etc.)
In our industry, ISPs used to, many still do. Shared hosters definitely. VPS, way too often. That dedicated host with a gigabit port? Well, you have a gigabit inside the datacentre... beyond ... it's a big question and not all are honest about it.
> Clearly there is some sort of profit motive for the airlines, but how can this be legal.
Because no one has done anything about it. There are any number of scummy beahviors which are still legal.
In this case, if (say) 1% of people never show up for flights, that's incentive for airlines to over-sell by 1%. Because the case where everyone does show up is the 1% of the 1%.
i.e. it's more cost effective to fudge things and deal with problems later.
The issue is that they have shitty procedures for dealing with that 1% of 1% situation. They still want to screw the customer out of every penny, where they could be telling themselves "We made our money on the other 99%, If we give this guy his money back and some more for inconvenience, we'll still come out ahead".
The insistence on screwing the customer no matter what is deeply ingrained in corporate culture. Money and bad marketing be damned...
No-shows are way more common than most people think, especially given the proportion of frequent flyers who are regularly flying for business and regularly buying flexible tickets.
I think a huge reason would be a connecting flight being cancelled or delayed too. Maybe the majority reason. I've been booked so tight before that even a 15 minute delay or a gate change to another part of an airport would make me miss a connecting flight.
Airlines employ teams, who look exactly into that (connections and potential misses). The look at the number of late incoming passengers that have a connection and make the following calculation :
Is it cheaper for them to hold the connecting flight, or does it make more sense, financially, to rebook them? Including paying for hotel rooms and compensation. Sometimes they have an agent at the gate of the incoming flight whisking the connecting passengers to their flight.
Here's another dirty secret to ponder: An airline may bump you even if there are free seats available. The reason being weight limits. It can be far more profitable to fly an additional container to Hong Kong then those three passengers with cheap economy class tickets. Even with the additional cost, which this incurs.
>Every time I hear it happen when passing though the USA
Which country do you live in? I didn't know there were countries that forbid the airlines from overselling seats and forced them to fly airplanes with empty seats when there are no shows.
Pre 2001 (late 90s, early 2000s), I'd on more than one occasion take a United flight from LAX to Melbourne via Sydney (same flight, deplaning people in Sydney) that would regularly fly the Sydney Melbourne leg with fewer than 50 passengers on a 747-400.
Most of the time these seats can be sold without a problem occurring because the original travelers don't show up. So if you overbook your ticket prices can be 10% lower than those of the competition.
As customers choose tickets based on comparison sites that order on ticket price only, ultimately the only thing that matters is the price. That's why there is overbooking, all kinds of cheesy attempts at hidden but obligatory fees and attempts at lowering standards to ridiculous levels such as flying without seats.
I agree. I do not understand the reasoning behind overselling. Profit, yeah, like the airlines don't make enough profit by cramming as much people as they can in the aircraft, and selling better seats for higher price.
Overbooking is rarely the result of intentionally selling 105 seats when 100 exist. It is far more often caused by flight delays (missed connections) and cancellations.
Let's say United has 8 flight a day from SEA to DEN. Each are fully booked and hold 100 passengers. 1 of the 8 flights gets cancelled today due a major mechanical problem.
If everyone from the cancelled flight rebooks a on a later flight, now each plane is overbooked by ~14 people.
Only one airline explicitly does not overbook flights on purpose: JetBlue. This leads one to expect that their overbooking rate due to flight cancellations (0.5 out of 10,000 passengers) is approximately the rate you'd see across the industry if what you're saying is true. Instead, Delta and United (for example) bump passengers at 10/10000 and 7.2/10000, respectively.
Your assertion requires that you actually provide evidence to counter these facts. As you have given none, I have to assume you are incorrect.
The probability of a bump for a 1K is more like 0.00001f (Source: I'm 1K). Basically they'd have to bump every other non-elite and lower-elite before even getting to you. The only time it can happen is if a gate agent screws up (unloads you as a no-show before the 15min mark, or clears you from standby into an already occupied seat (this has happened to me).
Also I would say a GS upgrade probability is closer to 0.9f. 1K can be anywhere from 0.1f to 0.8f depending on the routes flown (a consultant flying hub-to-hub around beginning / end of week will be 0.1f; me flying leisure routes mid-week will be 0.8f).
That simplistic code will result in airplanes flying with empty seats.
Since jet fuel airplanes are probably the most expensive form of travel that's 2nd only to space tourism flights on liquid oxygen rockets, it would be an irresponsible waste of energy.
To be clear about the specific problem we're trying to solve, it's the involuntary bumping instead of the voluntary ones.
Why is using "empty seats" the superior solution instead of raising the financial incentives to attract volunteers to be bumped?
>Why is using "empty seats" the superior solution to raising the financial incentives to attract volunteers be bumped?
I travel 90% of the year and there is no reasonable financial incentive (especially if they are just flight vouchers) they could offer that would make me volunteer my seat. If I'm travelling, it's for business and I have no desire to be late. If it's travelling back home, I want to see my family and I'm not going to miss that flight if I don't have to. On busy commuter flights, I would imagine most passengers share my sentiment. This would ultimately lead us into a situation where someone is randomly removed from the aircraft against their will.
Furthermore, being offered flight vouchers to give up your seat is really stupid on commuter flights. Pretty much every person on those flights has more miles than they know what to do with. Offer cash instead.
I'm a heavy business traveler, though not a business commuter per se. In my experience with oversold flights, there are a few people who will eventually cave and take the buyout -- but I want to place sharp emphasis on the word eventually.
The moment an airline attendant announces an oversold situation, that announcement kicks off a frantic battle between dopey consumer game theory calculus on the one hand, and rigid airline offer-escalation procedure on the other. This slow, maddeningly predictable war of attrition often results in delays of 45 minutes or more. Those delays cascade into further delays when the flight misses its departure window.
We have a "not enough dopes" problem. There need to be more people willing to take buyouts, and since that's not happening, we can consider pretty much any alternative solutions that make sense.
>This slow, maddeningly predictable war of attrition often results in delays of 45 minutes or more.
I'm a 2-million-miles frequent flyer on American Airlines and I've never seen voucher auctions require 45 minutes. Usually it takes less than 5 minutes. Often, the gate agents run the auction in the lounge which doesn't add any delay to the plane pushing away from the gate.
>We have a "not enough dopes" problem. There need to be more people willing to take buyouts, and since that's not happening,
Is the goal to have zero involuntary bumps? Because 40,000 involuntary bumps out of 660,000,000[1] seems like there are "enough dopes" on virtually every plane.
Right. The solution is for them to immediately say: We need 3 people to take this offer of $800 in US cash (not vouchers), or 3 people will be selected randomly.
I guarantee there will be enough takers. The issue is, even though the cost of overbooking is already factored into the cost of the flight, the airline is still trying to eek out extra dollars by offering less than the cost (vouchers, starting with lowball offers, etc).
I'm not a lawyer, but pre-announcing that three unfortunate souls will be summarily booted from the plane seems like a lawsuit waiting to happen. I'm guessing they go through the whole song and dance partially to minimize the payout, partially to collect data on average payouts and equilibrium pricing, and partially to create the opportunity for volunteers to leave willingly.
Don't get me wrong; I'd love if they simply cut to the chase. But airlines are not in the business of customer service, as is often painfully obvious. They seem to take their business practices from the Ferengi Rules of Acquisition. (In particular, the dictum, "Once you've got their money, never give it back.")
You're a business flyer, have status, and would never be bumped involuntarily due to your status. (I'm a UA 1K, so I'm in the same boat.)
But the point is that it's a market. Pretty much always there will be a price at which someone is willing to give up their seats for whatever incentive. The overall system with overbooking, voluntary bumps, and the occasional involuntary bump is overall much more efficient.
I mean, don't we already have "standby flying" where you can show up at the last call time and claim seats purchased by no-showers? The bit about having to overbook to fill capacity is bogus - as long as standby flights are cheap enough, people will accept the inconvenience/risk of standby flying and fill the remaining seats.
Of course, the real issue is a monetary one for the airlines because standby tickets have to be discounted. But as a customer, I still advocate against overbooking.
>as long as standby flights are cheap enough, people will accept
If you're open to using financial incentives like cheaper pre-arranged "standby" flights, why is that better than auctioning cash/vouchers to willing passengers volunteering to be bumped?
The problem with your proposal is that all the passengers are forever sorted into "guaranteed" and "standby" according to first-come-first-served:
|timeline of bookings -->-->
|-- guaranteed --|--- standby --|
However, order-by-reservation-timing does not reflect the true priorities of the passengers on the day of the flight. Many of (possibly most) of the passengers that bought the earlier "guaranteed seats" happen to be the ones most willing to accept financial compensation for bumping.
In terms of game theory and fairness, calculated overbooking based on stable historical trends seems to be the most optimal strategy that benefits the most people. The real issue is that the airlines implement the compensation incorrectly. Instead of blaming the overbooking, blame the airlines' compensation rules:
1) offer cash instead of vouchers
2) eliminate silly rules about caps
3) start the auction process as early as possible in the lounge area instead of waiting until the last minute by standing in the aisle of the plane with a bunch of impatient passengers. (With American Airlines, their check-in kiosks will sometimes alert passengers and give them the option of being voluntarily bumped.)
There is a law in the US that they are required to give you cash. However they will always ask if anyone wants to volunteer for a voucher first, and keep raising the value of the voucher. If nobody takes it, whoever gets bumped gets cash. Usually that never happens.
You can go to the faa website and read how much cash, it's some multiple of the ticket price.
That's not quite the same. Bumping people involuntarily and paying them the minimum cash required by law is how you end up with security beating people up to get them off the plane.
I don't think that law should exist. They should be required to pay whatever it takes to get enough people to go willingly.
> They should be required to pay whatever it takes to get enough people to go willingly.
Let's say this suggestion was implemented in law. In civil law, they could always breach their contract with you, and refuse you boarding anyway.
You'd then sue them and be awarded damages because they breached their contract with you. But it'd cost you a ton of money to do that, and so nobody will do this.
The law that sets the compensation amount shortcuts this and gives you the money more directly.
"Be required to pay whatever it takes" is the default position of a contract. If you want to return to that, you'll be stuck with the situation above.
You could instead increase the statutory compensation amount. Then they'd be in an reverse auction situation. They'd rarely need to force anyone off because some passenger will cave sooner for the money.
In other words, you'll get what you want if you increase the statutory compensation amount, but you won't if you eliminate it as you suggest.
>...You'd then sue them and be awarded damages because they breached their contract with you. But it'd cost you a ton of money to do that, and so nobody will do this.
The limit on small claims court is usually 5 thousand and small claims court doesn't cost a "ton of money" and is very accessible. Since anyone could be bumped, there are cases where I am sure the damages would be greater than 5 thousand, but then you would have the incentive and means to hire a lawyer.
The law to set up compensation limits in the US was done to lower the costs to the airlines, not as some way to help the consumer. There is no reason that anyone should ever be involuntarily bumped - this law just made people think this was somehow acceptable.
> The limit on small claims court is usually 5 thousand and small claims court doesn't cost a "ton of money" and is very accessible.
You risk being awarded just a refund of the ticket, which I'm sure that United would offer anyway. And then you'd be down court fees and perhaps loss of earnings for a day to attend court. It's not worth it for ordinary people.
> The law to set up compensation limits in the US was done to lower the costs to the airlines, not as some way to help the consumer.
>...You risk being awarded just a refund of the ticket, which I'm sure that United would offer anyway. And then you'd be down court fees and perhaps loss of earnings for a day to attend court. It's not worth it for ordinary people.
Court fees for small claims court are minimal. Your original claim was that it cost "tons of money" - I think you will agree that is not true. Your claim that "It's not worth it for ordinary people is just a guess. My guess is that the vast majority of the people who get a seat assignment when they book never consider the possibility it might be taken from them. Most of the time, people are conditioned to not want to cause a scene, but I can bet no one is too happy about it when the other side doesn't fulfill their end of the deal. Having even a small number of people filing cases against the airlines would cost the airlines far more than than they currently pay out (they have to show up at court etc) - it would also likely lead to class action lawsuits, etc. Those low statutory limits on payouts are there to make sure the cost to the airline is minimal.
I didn't say anything was wrong with overbooking. Whether it results in lower ticket prices or leads to more profit for the airline will actually vary, but it is ultimately immaterial - making more productive use of airplanes is good for everybody. The issue is involuntary bumping and treating this as somehow acceptable. If the airlines screw up and have too many passengers for too few seats, it is up to them to solve the problem through voluntary means - the system described in this article is one way to help do that.
In the end, the whole idea of involuntary bumping should probably be viewed as regulatory capture. We don't allow that in other industries.
The point is that they do offer enough to get people to bump voluntarily, and it doesn't include any cash like 90%+ of the time, because people are willing to accept travel voucher instead.
If no such law exists, and everyone refuses up to like a million dollars, than what, the plane just sits there and nobody leaves? There should be some cap. Maybe it should be higher, but not unlimited. (I'd be more in favor of no overbooking at all honesty)
The other part of the problem is lack of awareness. Most people in the US don't know you are legally entitled to cash if bumped involuntarily. If they knew, more would hold out for cash instead of vouchers.
My point is that that remaining 10% of the time is some massive problem when there's a simple solution.
Your hypothetical is silly. What if Jesus Christ descends from the heavens and declares air travel to be a mortal sin? That's about as likely. It's not going to be impossible to find a few people among 100+ who are willing to take the next flight for an amount of money that's at least vaguely reasonable.
And if airlines don't want to risk it, they always have the option of not overbooking. This way it's their choice how to handle it.
No the remaining 10%* of a time it's also not a massive problem, they hand over cash and someone is really pissed. The United thing happens when they let someone board first that they shouldn't have, and then tried to haul him off.
We can argue that the cash offer should be higher, but when was the last time you even saw the voucher bids go up past a thousand dollars and then get replaced by cash? I'm guessing never since you didn't even know it was the law. I've never seen it, only increasingly high voucher offers.
* Also it's not 10%, it's like 1 in 100000 passengers.
"I'm guessing never since you didn't even know it was the law."
Assumes facts not in evidence. I'm well aware of the law. I'm also well aware that the law specifies a pretty low cap on what airlines are required to give.
Offering people worthless vouchers and then bumping people involuntarily for a mere 4x their fare for that segment is very much not what I was referring to in my original comment.
But then I'm confused, is the complaint that for the 0.001% of passengers, they should get higher cash compensation? Because the other 99.999% of passengers either board without issue or take vouchers.
My complaint is that the airlines are too quick to bump people involuntarily and too quick to complain about overbooking. The "problem of oversold flights" (as the article puts it) is trivially solved without involuntary bumping. They just don't want to.
This article paints involuntary bumping as some terrible thing the airlines are saddled with, and this new approach offers a way to finally get past it. Which just isn't the case at all.
Yea I agree with you on both points there. I wish there were no overbooking. I wonder how Southwest's recent stance (they won't overbook) will affect their business...
>...The United thing happens when they let someone board first that they shouldn't have, and then tried to haul him off.
No, the United "thing" (aka the assault) happens when they decide that a someone who made travel plans, paid for a seat, travelled to the airport, went through security and waited for the plane just to have the airline decide that they would breach their contract and use the seat for their employee. The fact that the individual had already boarded the plane meant the poorly trained security people had to use an extreme amount of violence against him, but even if they had stopped him before boarding the plane, it doesn't explain or excuse the companies willful breach of contract.
Because that someone else also paid for a ticket and was told by the airline that they would be on that flight. The airline is the one responsible here, not the passenger who gave them money for a ticket with no idea that there wasn't actually a seat to go with it.
When this happens, the people without seat assignment haven't boarded at all, there's 10 people for 9 seats or w/e, and the airline tries to get one of them to cave for the lowest price.
The offered price of the bump wasn't the only failure, or even the most important failure, in that chain of events.
Note that this behavior is extremely, unbelievably rare. N=1 over hundreds of millions of flights rare.
There is a lot of other discontent regarding bumping on oversold flights, but the existence of a cash minimum doesn't by necessity lead to assaulting passengers.
I disagree. Their ability and willingness to remove people involuntarily creates an adversarial relationship where none needed to exist. Everything else flows from that.
Yes, assault is super-rare in these cases, but unhappy passengers are fairly common. People hate the airlines for overbooking. If they always offered enough compensation for people to be willingly bumped, this wouldn't be the case.
Isn't this what happens in Europe because of some regulations? I recall being involuntarily bumped from a US-bound flight in the UK once and they handed me cash. Well, they handed me a voucher which I had to take to a specific window in the airport where they put euro bills in my hands.
Why not just sell the overbooked seats AS overbooked seats.
So the person booking that seat knows, it might happen, or not..
In that case the tickets are more interesting to people who can get a flight a day later without problems etc..
Simple money back policy so it wont resort to incidents with cops or buyout money..
Exactly my point, they could and should market them as such.. Even could be forced by the government for it, because it is a different product than a seat that is available..
>"This week, United Airlines Inc. is quietly unveiling a new technology platform that it will use to manage the problem of oversold flights—and, in the same breath, turn them into a profit opportunity."
Not fix the problem but "manage" it. Imagine telling your boss you've decided to manage a problem instead of fixing the root cause.
>"With the help of its new Flex-Schedule Program, the airline is piloting a way to buck the trend of involuntary bumping—the term for kicking passengers off oversold flights—without necessarily offering four-figure payouts to passengers at the gate, or curbing their practice of overselling inventory."
Rather than fix a problem that they themselves are responsible for they are instead going to treat it as a "revenue stream"? Why is this even legal? If you experienced this at a car dealer, a restaurant or a hotel you would never do business with them again.
Is there any other industry that knowingly engages in selling the exact same item to two different people only to cause stress to one of those two people?
They are still bumping you, they just aren't doing it at the last minute.
Vote with your wallet and avoid this airline altogether.
More significantly, Delta does this at check in time and solicits bids, aka 'volunteering.' Because the people involved have volunteered, Delta can accept the lowest bids AND because people have volunteered there's a big reduction in legal protections of that becomes significant - they volunteered and surrendered their seats, they weren't bumped.
United is also soliciting volunteers at check in. I got $400 in Austin in 2014 to fly a day later. Sweet! Their first offer was $120 which I refused.
But certainly Delta has been paying more, it was a 3000+ ppl computer conference ending and some sports event at the same time so the airport was a total gong show and Delta paid a friend of mine $1200 to not fly to New York.
Also, vouchers can usually only be redeemed directly through the airline, which usually means you'll be paying a "full price" fare.
That $300 flight you buy on Orbitz is considered a hugely discounted fare. The same seat at "full fare" would be $900-1000.
So in this example, if you got a $400 voucher for being bumped from another equivalent trip, the expected value of the voucher is -$200 because you would have to pay the airline ($900 - 400 = $500) to book that $300 seat. You would need to combine multiple vouchers before it made financial sense.
I respectfully disagree and even question how experienced you are with the flight industry.
The reality is that the lowest fares are often found on the airline website and the airline website only and the voucher is good there. There are sometimes but rarely real good offers on these OTAs but it's literally getting rarer and rarer day by day.
Well, all I can say as a former Continental Platinum (and later United 1K) is that the combination has resulted in the uttermost cesspool of service, fees, annoyances, and outright insults (thanks for stranding me overnight in Louisville KY on my way home to NJ and not even giving me a voucher for a hotel!). Anything they can do to improve service is fine in my book, but I'm not holding my breath. And just don't get me started on upgrades, delays, and bumps... let's just say I never fly United unless it's a direct flight.
People want to pay the _absolute_ minimum possible to travel, no exceptions. If you tell people "For $5 more we won't have you kicked in the head by an angry toddler" people loudly tell each other "Yeah, yeah, I really want that, $5 is a steal". And then, they click "No thanks" and say to themselves "Saved myself $5"
Every safety feature on an aeroplane is there because it's mandated by law. If you let people go without for a dollar, people who'd use a dollar to wrap used gum will forego the safety to save a dollar, because people think of every dollar spent on air travel as somehow "wasted" even as they simultaneously complain about how awful air travel is.
Over the years Airlines have _tried_ telling customers they're interested in offering a better service for a higher price, and customers almost all say that's what they want, and almost all choose a different, cheaper airline. This is the customers' fault, as clear as day.
This is an incredibly popular meme, with absolutely zero compelling evidence to support it.
Airlines are, in general, incredibly bad at advertising the small ways in which their coach seats are better. You have to go to weird niche websites to find this information. And you're blaming the customers here?
If you ever wondered what happened to Adioso, well, here's part of the answer. The company took the insights and technology assets it had developed for the consumer market and turned them into enterprise services to offer to airlines, and that has been the focus for the past 3-4 years.
As evidenced by this breakthrough, it has turned out to be a very good move.
The original Adioso product still exists but in a different entity, and its current status is best described as side-project. I'm still optimistic that the original vision we had for Adioso as a consumer product will be realised, but it will end up looking very different to what it's been to date.
In the meantime, it's extremely pleasing to see Volantio making such an impact.