Archive for the 'regulation' Category

Should we trust airlines to improve passenger rights?

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trust-no-one.jpgAs reported a few days ago, American Airlines is trying to undermine the proposed Passengers’ Bill of Rights by announcing policy changes that promise service improvements, such as limits on the time passengers spend sitting in aircraft while parked on the tarmac. But should we trust this new policy?

Over the weekend, Joe Brancatelli wrote in to give the issue some historical context. The last time there was a real effort to legislate passenger rights, in 1999, airlines responded with “customer commitments” or “customer service plans,” which are still alive and well on various carriers’ websites.

These plans amount to a list of promises and goals, to which each company vows to adhere. Notably, however, these plans are NOT incorporated into the contract of carriage, and therefore carry no legal weight. They’re a voluntary set of promises, but promises are made to be broken. (Much like Delta’s promise to never put expiration dates on their frequent flyer miles, a promise they went back on recently… but I digress.)

In a 1999 column, Joe argued that the customer service plans were a sham. To this day, American Airlines’ customer service plan still includes this final paragraph:

We take the customer service goals in this plan very seriously. We know that you expect nothing less. However, the Customer Service Plan does not create contractual or legal rights. Rather, our contractual rights and obligations are set out in our conditions of carriage, applicable tariffs, and ticket jacket, all of which provide additional details on the matters discussed and must be consulted to fully understand your rights and our obligations. For example, we are not responsible for any special, incidental, or consequential damages for delays, cancellations, lost baggage, late refunds, or instances in which we do not meet our service goals.

So I share Joe’s pessimism. It’s nice that the airlines would acknowledge that a problem exists, but if the industry doesn’t put any legal meat on these customer service bones by incorporating them into the contract of carriage, then it’s really not worth celebrating. The proposed policies are probably just a cheap imitation of a real set of passengers’ rights. They’re a cynical effort to head off legislation. Keep up the fight.

Related:
- Earlier posts on Passengers’ Bill of Rights

American Airlines tries to pre-empt Passengers’ Bill of Rights

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Consumer interest in the proposed Passengers’ Bill of Rights must be gaining momentum, because American Airlines just blinked. The company is publicly making policy changes, in an obvious attempt to avoid regulation.

The Global Traveller caught wind of this last night, and details are now more readily available:

American Airlines Inc. says it won’t hold passengers on grounded aircraft more than four hours, a policy born from a December debacle in which thousands of passengers spent hours in Austin and elsewhere waiting for storms to pass inside crowded parked planes.
[…]
In addition to the four-hour policy, American is making changes at its systems operations control center in Fort Worth to better handle diversions and make sure officials are aware when passengers’ wait times are building up.

The airline is creating a position to oversee diversions and help schedule flights to get passengers back to their connecting hubs.

It is developing automation tools to warn managers when passengers have been on the ground a long time.

The carrier said it also was “reviewing all procedures related to customer handling and make appropriate changes as needed.”
[…]
4,600 customers on 67 planes sat more than three hours Dec. 29, a good portion of whom were kept on board for more than four hours.

American is sending apologies and vouchers of up to $500 to passengers who were subjected to waits of three hours or more on the ground.

Four hours in a parked plane is still more than the three hours that the draft passenger bill of rights calls for, but it’s better than nine…

Interestingly, too, the airline is trying to buy off the angry passengers by throwing them $500 in vouchers, six weeks after the debacle.

Something tells me that Kate Hanni and the other “stranded passengers” won’t be mollified by a promise and a voucher. They shouldn’t be. It’s good that the airline is acknowledging that there are problems with the way it does business, but more needs to be done.

Related:
- Will a passenger bill of rights be enforceable?
- Update: How to support the Airline Passengers’ Bill of Rights
- Do we need a passenger bill of rights?

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Why are some countries exempt from British Airways’ draconian baggage rules?

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After updating yesterday’s post regarding British Airways’ absurdly expensive surcharges for checking a second piece of luggage, one item in the fine print stuck with me. It was the exemption:

“World Traveller customers travelling / connecting to or from the US, Canada, Caribbean, Nigeria, Brazil and Mexico will continue to be allowed two checked bags in line with the local government regulations.” (emphasis added)

I did a search for the American regulations, so I checked the rules at the FAA, FTC, and TSA. I couldn’t find anything mandating the inalienable right to two suitcases on flights to or from the United States.

After all, Spirit Airlines just instituted a rule that a second suitcase would cost you $10 extra. So I don’t think there’s anything on the books here in the U.S.

So what is going on? I suspect that British Airways is using the guise of government regulation to create this exemption, given the amount of competition on routes to the United States. Once word gets out, passengers who travel with two bags would be loath to book with BA if Virgin, American, or United will happily take two bags.

In fact, this may largely be the “Virgin exception.” Virgin Atlantic flies to the US and the Caribbean, while Virgin Nigeria flies to Nigeria (obviously). Virgin still permits two free checked bags. To Brazil and Mexico, maybe there’s another carrier that BA is really trying to hold off.

In any case, I call BS on the “local government regulations” line. Corrections are welcome.

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Will a passenger bill of rights be enforceable?

The hubbub about the proposed passenger bill of rights last week is still alive and well, if my e-mail inbox is any indication. Several readers have written, asking for more information, or ways of supporting the cause of such a bill. (Let’s call it the PBOR for short, giving it that official-sounding government-ese acronymic flavor, and cutting down on my typing…)

The draft PBOR is posted here and at the angry passengers’ blog. A petition is available, too, if you want to show your support.

Congress is taking the PBOR seriously, and I think that’s a good thing, but even if such a bill passes, would it be enforceable? How do you determine blame? And if so, what are the penalties?

Most of the goals that the PBOR sets out are rules or requirements, but the only penalty that’s referenced is for flight cancellation or delay of 12 hours or greater.

For example: “Establish procedures for returning passengers to terminal gate when delays occur so that no plane sits on the tarmac for longer than three hours without connecting to a gate.” No doubt, that’s a reasonable goal, but whom do you blame, and what are the consequences, if this doesn’t happen?

I sat on the ground for hours once at O’Hare, flying back from Philadelphia, after a snowstorm wreaked havoc on Chicago aviation. (This was the same day, in 2005, when the Southwest plane went off the runway and into the streets of Chicago.) The 737 I was on was parked for hours on the outskirts of the airport, waiting for a gate to open. The rear toilets overflowed. It was one of the few times that I wished I was at a European airport like Frankfurt, where every other flight is parked out in the middle of nowhere and passengers are bused back to the terminal. There was no bus for us. Just a long wait, until another gate opened up. But with so much snow falling, few aircraft actually left their gates.

So who was to blame? The airline? The airport? The weather?

The problem with any such legislation isn’t the determination of what the desired outcome should be. It’s the determination of who is to blame when that outcome isn’t reached.

Related:
- Update: How to support the Airline Passengers’ Bill of Rights
- Do we need a passenger bill of rights?

Update: How to support the Airline Passengers’ Bill of Rights

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Reader Lisa writes:

I would be interested in supporting a passenger bill of rights, if someone started a “movement.” I don’t fly that often, but worry every time I go that I’ll be subjected to something like the 9 hour wait on the runway. Please let me know if there’s somewhere I could email, or send a letter of support for such a thing.

The idea of a passenger bill of rights is not new, but there hasn’t quite been a “movement” yet. The issue is getting some fresh attention lately, though.

Looking back a few years, the American Society of Travel Agents (ASTA) has a longstanding proposal for a bill of rights. Some arguments in favor of such a bill are here. The airlines, predictably, oppose such a measure, and have been able to keep it off the books. (An account of the industry’s pre-9/11 efforts to block a bill of rights in Congress is here.)

As far as the new efforts to get a bill of rights going, I can’t find a petition address. But there IS a blog… here. The blog, titled “Coalition for Airline Passenger’s Bill of Rights,” is presumably run by the lawyers for the passenger group that filed their complaints with Congress (though technically the blog is written under the pseudonym “Coalition for Reform of Airline Passenger Protocol”… or CRAPP.)

If you want to register your support, you might try leaving a comment on that blog. But above all, you should write to your senators and representatives, as well as Sen. Daniel Inouye of Hawaii, the chairman of the Senate Committee on Commerce, Science and Transportation.

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Do we need a passenger bill of rights?

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Back on December 29, passengers on board American Airlines’ flight 1348 from San Francisco to Dallas experienced the textbook definition of airline hell. A delayed takeoff due to a mechanical. A weather-related diversion to Austin, where no one was allowed to deplane for nine hours. Overflowing toilets. Minimal food. All trapped on board an MD-80. Scott McCartney’s account of the flight is the definitive treatment.

Passengers on board that flight, and their equally angry compatriots from other flights, are still fuming. Their lawyers claim that the airline has never apologized for the treatment. Now, they’re calling for the U.S. Congress to pass a passengers’ bill of rights.

The European Union already has a passenger bill of rights in place. Most famously, it calls for cash payments when the airline delays you for reasons other than weather or acts of God.

See below for the complete Passenger Bill of Rights proposal. Remember, this is just a proposal, as written by a law firm representing angry travelers, and some of it may be pie-in-the-sky. (Do they really think they can control codeshare partners? Good luck with that!) But are they on to something? Read below, then sound off!

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Update: Virgin Atlantic revises its ownership structure, potentially making it legal

Yesterday’s post on Virgin America may have prematurely written off their chances of success, despite their sassy use of petitions and viral videos.

Late yesterday, the airline announced a corporate restructuring, which, in their claims, reduces the whiff of excessive foreign ownership, the factor which previously grounded the company. Britain’s Virgin Group will hold 2 seats on the board, or no more than 25% of the votes. The list of changes to the corporate structure is outlined in a press release. (Now, why didn’t they do this stuff earlier, when it was obvious their application was going to be shot down??)

This will hopefully convince regulators that Virgin should open for business. I think it will work. And soon enough, you’ll be able to play Doom, chat “online” with people in row 25, watch satellite TV, or ponder who the genius is who decided white leather seats were a good idea on a commercial airplane.

Viva competition!

Related:
- Virgin America wants your vote, teases you with glimpses of their planes
- U.S. government says Virgin America is un-American

Virgin America wants your vote, teases you with glimpses of their planes

Virgin America, the airline whose operating certificate was denied by the U.S. government because it was deemed to be a foreign entity, and thus in violation of law mandating American ownership of domestic airlines, isn’t giving up. (Background here.)

The CEO of the airline, Fred Reid, is pitching the airline’s comforts, especially the seatback entertainment system (I’m amused by the chat room feature), which is pretty nice. But he’s not just marketing the airline’s offerings. He can’t, after all. They don’t fly anywhere yet. So he’s asking people to sign a petition at their website, letVAfly.com.

As dumb as I think protectionism is for the airline industry, the law is the law, and the airline hasn’t done enough, it seems, to convince regulators otherwise. Their ownership structure is absurdly convoluted (hat tip to CrankyFlier). How will a petition, even if it’s signed by thousands of people salivating for better inflight entertainment or 110V power sockets, help get this airline off the ground? That doesn’t change their ownership structure.

In any case, the video below offers the cabin tour. What do you think?

Flying from the UK? Pay your taxes or lose your ticket

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Traveling from (or through) Britain? If you’re departing on or after February 1, 2007, and you’ve already got your tickets, you need to check with your airline to make sure you don’t owe more money.

The reason is the increase in the Air Passenger Duty, announced in December, with monies intended to go toward projects that reduce global warming. (See here for a backgrounder, including some speculation on how the increased taxes might boost traffic at Frankfurt, Paris, or Amsterdam.)

For tickets purchased before the tax went into effect, you’re not exempted. British Airways is covering the tax for its customers, but (unsurprisingly) easyJet and Ryanair aren’t. And making matters worse, it’s YOUR responsibility to find a way to pay the taxes before your flight. If you don’t pay, you don’t fly.

How much can you expect to pay as a supplement?

Air passenger duty will rise from £5 to £10 for economy-seat passengers taking domestic and European short-haul flights, and from £20 to £40 for economy-seat travellers on long-haul flights. Business and first-class passengers will face bills of £40 for short-haul flights and £80 for long-haul.

Check your airline’s website as soon as possible. Expect plenty of angry flyers, and plenty of mayhem at British airports in February.

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U.S. government says Virgin America is un-American

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The U.S. Department of Transportation has ruled that Virgin America, the long-planned low-cost airline that shares the Virgin name with Richard Branson’s Virgin Atlantic, is ineligible to receive an operating certificate in the United States. The reason: The regulatory body considers the airline to be under foreign control, and American law does not permit more than 25% of the voting stock of any airline to be in the hands of non-U.S. citizens.

This is all just silly, and it strikes me as anti-consumer protectionism, pure and simple. The other airlines don’t want the competition, and the government is letting them get away with it. For example, Continental Airlines argues that the Virgin America CEO is effectively a foreigner, even though he’s American. Why? Because he was the British firm’s choice.

But in an age of global capitalism, aren’t these citizenship tests and percentage calculations increasingly meaningless? And why is 25% some magical threshold? I might even understand the argument that you would want to require a domestic majority for some national interests, but why is a 75% supermajority necessary?

The whole thing smacks of greed, wrapped in the flag. And with airlines trying to merge, with the publicly stated goal of decreasing competition and pushing up airfares, we need all the competition we can get. Regardless of nationality.

Related:
- Will foreign ownership of airlines mean lower prices?
- US-EU open skies treaty dead in the water, so to speak

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Duty free liquids soon to be liberated?

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News for travelers who like to pick up a bottle of hooch or perfume at the duty-free shop:

The International Civil Aviation Organization (ICAO) is trying to standardize airport rules around the world, making it universally legal for people who buy liquids after security. Benet Wilson reports:

ICAO recommends that member countries allow duty-free liquids that have been packed in a sealed plastic bag that is tamper-proof and shows proof of purchase at an airport shop or aboard an aircraft on the day of departure. And best of all? ICAO wants the new recommendations to cover departing and transferring passengers.

A good start, indeed. Anything that lets you buy things at an airport and then actually carry them on a plane is good in my book.

Related:
- Duty free liquids allowed on board, except when they’re not
- Update: Munich Airport responds to questions about its duty free policy
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Flights from the UK about to get pricier

Traveling to and from Britain? The taxman is calling, and your tickets are about to get more expensive.

The UK government will double the air passenger duty for flights departing the UK, effective February. For short flights, the estimated effect on the total price of a ticket is a 7% net increase. For long-haul flights, the tax goes up £20 (~US$40) for economy class and £40 in business class. Ouch.

The monies are supposed to go toward reducing the environmental effects of air travel, according to the public statement by the Chancellor of the Exchequer. All well and good, but how exactly will the UK government be doing that? Are the added revenues going into a research fund, or into the general budget?

Update: As the Global Traveller astutely notes, this could lead some savvy tax-dodgers to book short-haul flights from the UK to mainland Europe, where they then board their (less-taxed) long-haul flight. If enough people sacrifice nonstop convenience for cash savings, then this could lead to an increase in takeoffs and landings, thereby backfiring against the stated environmentalist goal. Business travelers probably would suck it up and pay the tax, but leisure travelers might hop over to Amsterdam, Paris, or Frankfurt…

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