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Government Adds New Rules to Airlines: the winners and losers

Planes at LAX. Photo by David Parker Brown

Planes at LAX. Photo by David Parker Brown

The US Department of Transportation announced more regulation on the airline business this week and it has me a bit confused. The airline industry is already one of the most regulated industries in the US and some of these new rules just seem silly. Let’s take a look at them one by one:

Lost Bag Means Bag Fee Refund
I actually like the concept of this — it makes sense to me. If I am paying an airline money to handle my bag, it makes sense that I be refunded that fee if the bag is lost at no fault of my own. However, I am not to keen on the government forcing airlines to do this.

Tarmac Delay Rule to Include International Flights
Even though I love flying, I hate being stuck on the tarmac. I can sit on a plane for 15 hours while flying and be fine since I am making progress. However just sitting on the tarmac going no where just bites. The DOT already has regulated domestic flights cannot be sitting on the tarmac for more than three hours and now extends that to international flights. I am already not a fan of the domestic three hour tarmac rule and even more against international flights.

Not all airports can handle international flights the same. If a flight needs to be diverted to an airport that normally doesn’t handle international flights, it is going to take time to get the proper personnel there.

Now that airlines could face huge fines with international flights to the US, they will be more likely to cancel them. Unlike many domestic flights, which have multiple flights per day, many international flights will only have a few flights per week. That means you could be stranded in another country for days versus being stranded on the tarmac in the US for a few hours.

More Money for Bumped Passengers
Over booking flights always makes sense on paper, but is super annoying when you are the person that gets bumped.

When an airline knows that on average there will be a certain percentage of people that won’t show up for a flight, so they oversell, that makes good business sense. Good business sense doesn’t always means good customer service. The fees will be increased from $400 to $650 for short delays and $800 to $1,300 for longer ones.

It does annoy me that many airlines do not seem to do the right thing when it comes to bumping passengers and quite a few have been fined. Out of all the rules imposed by the DOT, this is the one actually angers me the least.

Disclose All Fees
This seems to duplicate what airlines already do. Maybe I have missed something, but every airline I have ever booked with clearly states on their website what they charge for. Sure some might be a little more tricky than others, but many businesses operate the same way. Have you ever tried to buy a car and get additional fees? Of course.

What is really bothersome is the government is looking to regulate how airlines show their fees. Why does the government feel the need to force airlines to do this, but not other industries?

Add Taxes and Government Fees to Advertised Fares
This one makes the least sense. What other industry is required by the government to include taxes and government fees to their advertised prices?

Most states have tax and people know they will pay tax. Can I walk into a dollar store with $1 and buy something? Nope, where I live I will need $1.09 and I know that. I think this goes to show that the airline business is treated unfairly and “consumer protection” groups are going too far to discriminate against airlines. I just wish the government wouldn’t play along.

15 comments to Government Adds New Rules to Airlines: the winners and losers

  • I’m right there with you…both agree and disagree. Things always look good on paper but don’t play out in practicality the way we’d like them too. You’ve already seen (over the winter with the snowstorms in the East) precancels become very popular….it’s easier to cancel ahead of time, the day before even, rather than try to deal with all of the planes full of folks trying to get somewhere. And the international comments you’ve made above are spot-on. I am very thankful to work for an airline that already takes its customer service pretty seriously. I do my best to help meet whatever needs I can every day of the week. And that feels good.

  • Claystation

    I too agree and disagree.

    I’m ALL FOR the baggage fee refund. Though, I don’t think it goes far enough. I think airlines should refund the fee if the bag doesn’t arrive with you. I LOATH the bag fees, and think that if we’re require to pay them for something that used to be included with the price of our tickets, we should get our money back when the basic service we’ve paid for is not provided.

    If I go to an ATM, pay the $3 fee, then the ATM tells me it doesn’t have money, but will charge me the fee anyway, then it will send someone out to give me money tomorrow morning… that doesn’t really help me when I need that money to go to the movies in 30 minutes. Why should I pay the fee to use the ATM then? It didn’t provide the service it was supposed to.

    Same principle with airlines and bag fees.

    The rest of the new regulations/fines I think are kinda silly. Seems they’re just meant to calm people down rather than actually fix the problems, and in fact may actually cause more problems.

  • MVFlyer

    Re: fee disclosure

    Yes, the individual airlines do disclose fees when you buy directly from their websites. And yes, you do expect to pay taxes (which is a constant amount regardless of airline).

    The differences between buying a car and a plane ticket: fees for car purchases are often arbitrary and negotiable (as is the price), while you can’t negotiate a plane fare or its fees. These differ between airlines, e.g. fuel surcharges, and may not show up initially when buying a ticket from a travel agent website used for comparison shopping. Throw in baggage fees (again, not all airlines charge them) and there could be a big difference in the actual amount paid. The airlines try to put the fees as late as possible in the transaction to make you think you’re paying the original amount.

  • rich (arizona)

    I can sit on a plane for 15 hours while flying and be fine since I am making progress.”

    While I’m pretty impatient I’m kind of like that while driving. I’d rather drive in a roundabout manner to get somewhere than sit in traffic, even if the latter may end up being faster. The former just seems like I’m more in control and am making progress.

    I’m with Claystation. Refund if bags don’t show on arrival.

    I don’t mind the 3 hr rule. I can understand issues with it but if we could trust airlines to do the right thing we wouldn’t have the previous issues of trapping people on planes for 6-10 hrs. Sadly common sense is lacking in many people and companies. Throw in the tight, cramped quarters with limited bathrooms, food and drink and an extended delay is a very unpleasant experience.

  • prognostication

    Add Taxes and Government Fees to Advertised Fares – This rule is LONG overdue. While you example makes sense: If I buy something, I expect to pay sales tax. It doesn’t translate to airfares. When purchasing something from the store, a consumer generally know the sales tax rate for their area. When purchasing airfare, a consumer has NO idea the level of taxes and fees that will be charged. Airlines advertise fares which are often over $200 lower than the actual price to fly. Flying to London is an excellent example. There are plenty of advertised fares to London for around $600, but when you try to book a flight, the price goes up to over $800. What makes it worse, there’s no way to know how much the Taxes and Fees will cost. They vary by departure and destination points.

    I applaud the US government for getting this one right!

  • Mark M

    The bag fee thing is a can or worms!!! If the bags are eiether not loaded, or misrouted that is airline error and applicable to the new regs. But, if bags/cargo have to be bumped due to the need to add more fuel for a weather or air traffic related issues (storm fuel/holding fuel/contingency fuel) otherwise the airplane exceeds the MTOW. Should the airline reimburse the passenger for situations beyond the airlines control??? Not to mention having to explain to every effected passenger why their bags got bumped?? There should be a clause that excludes weather or operational issues as a justification for the missing bag(s) and only reimbursable after three days after the arrival of the flight if this was the cause. Then that brings up the airline to use that excuse to avoid reimbursement on every claim and so on..Like I said its a can or worms…

  • I am happy to see that they will have to show taxes on fees on fares. I wouldn’t mind much if United never did that, but when they stopped doing that and just showed the fare + fuel surcharges it pissed me off. I totally understand that they just joined every other airline, who were already doing it so they would look cheaper, but I really loved that. It would’ve been nice if they had a setting in MP where it would allow you to view fare + taxes instead of fare, but I guess it doesn’t really matter now.

  • Drew V

    I like the “out the door” pricing idea. Tell me the total cost now. Let me choose some options ahead of time (bag check-in, extras, etc.) so i can see my total bill and not have to take out my credit card when I get to the terminal.

  • Songstar

    I think 3 hours is plenty of time to wait to take off on a 17 hour flight! Let us offa here!

  • Songstar

    Instead of lugging my bags through the airport.. I use UPS 2day and my bags are ALWAYS on the doorstep of my arrival point when I get there!

  • The airline industry should have to operate like all other businesses. Poor service and customer inconvenience should receive more than an “I’m sorry”. I understand that there are things that happen, like an “act of God” situation, but customer inconveniences that occur because of the lack of equipment maintenance should require some sort of customer service gesture, I.e. partial refund. I recently went on vacation taking US Air to my destination with the plane leaving 3 hours late because the radios went out. On my way home on Contential I was 2 hours late leaving Houston because the fuel gauges weren’t working as well as the air conditioning. They made us sit on the Tarmac for an hour and 23 minutes with no air, in Houston, in July. We had babies, elderly and a full plane, it was sweltering. It was disgusting to watch the customers in First Class being served drinks while we weren’t even offered a bottle of water.
    We take it because we have to and the airlines know it!

  • I completely agree with everything you wrote….except the taxes. As a consumer I should have the information right on hand how much tax is being charged. And that brings up another question: how can it be that a flight from a to b on different carriers is taxed differently? Example:
    Delta from PHX to BRE is taxed with 250, UA is taxed with 220 and Lufthansa has a 380 Dollar tax ticket?

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