The Department of Transportation (DOT) has extended the effective dates of key portions of the most recent rulemaking for an extra five months. These extensions were requested by the airlines and by the American Society of Travel Agents and categorized as either too complex to enact within the original time period, or impossible to implement without airline data that has not been provided.
The Consumer Travel Alliance (CTA) filed comments at the end of June responding to the airlines’ request for an extension. The CTA position is that the means to comply with the rulemaking are already ready to go and that there in no need for delay.
The Consumer Travel Alliance is against any delay in implementation of the rulemaking. However, we realize that without a mandate that the airlines file baggage fee information in a data format accessible to the entire industry, ticket agents will have a difficult time of disclosing baggage fees on itineraries as required by the current rulemaking.
After consideration, the DOT has relented on some of the requests for extension of the effective dates of the rulemaking and has held firm on others. It is a mixed bag for consumers, however, with DOT working towards a comprehensive rulemaking specifically addressing ancillary fees, this delay is a step towards full price transparency.
Specifically, the Department is extending the effective date from August 23, 2011 to January 24, 2012, for requirements pertaining to baggage fees, post purchase price increases, flight status changes and holding a reservation without payment for twenty-four hours. The Department is also extending the effective date from October 24, 2011 to January 24, 2012 for requirements pertaining to full fare advertising. The effective date remains August 23, 2011 for all the other requirements in the April 25, 2011 final rule, including the requirement not to permit an international flight to remain on the tarmac at a U.S. airport for more than four hours without allowing passengers to deplane, the requirement increasing the denied boarding compensation airlines must pay to passengers bumped from flights, and the requirement to disclose prominently all fees for optional aviation services on carriers’ websites.
The extension of the tarmac-delay provisions for international airlines has been denied. A requested extension of the denied boarding compensation increases and tighter rules was denied and the requirements for the airlines to clearly delineate their ancillary fees on their websites was denied.
The airlines were granted an extension to the rule that they include specific baggage charges on airline ticket itineraries. Airlines will still be able to raise prices after purchase. Flight status change notifications have been delayed. And the requirement that airlines allow passengers a 24-hour window to refund ticket purchases without charge has been delayed.
These items require significant changes for the airlines.
Baggage charges
Airlines have claimed that theirbaggage fees are too complex to clearly be communicated to passengers. Again, here are the comments from CTA.
To believe that state‐of‐the‐art computer systems that run giant airlines, change airfares at the drop of a hat, coordinate flights, schedule personnel, deal with spare parts across the world and handle accounting for one of the most intricate businesses on the planet, cannot display the costs of checked luggage on a ticket itinerary that has already been sold is difficult.
The Consumer Travel Alliance went to the airlines’ own organization that currently dispenses airfares — ATPCO. Based on their website and their comments to this same rulemaking that distributing this data through the industry so that the rulemaking can take effect can probably be done next week, certainly within the month and without a doubt by the time that the DOT rulemaking is supposed to come into effect.
However, this mandate cannot be fulfilled unless the airlines load the baggage fees into the ATPCO database that can be accessed from every point of airline ticket sales. Disclosing this data is exactly what the airlines are fighting. They want to keep baggage fees hidden.
The system to solve this problem already exists. Indeed, ATPCO trumpets the robustness and readiness of its Optional Services systems, designed to handle ancillary fees like baggage, seat reservations, early boarding, etc.
Increasing prices after purchase
Spirit and Allegiant Airlines have filed court papers contesting this portion of the rulemaking. The delay will allow the legal issues to be settled before the rule becomes effective. This rulemaking delay was unexpected but, evidently, a result of legal intervention.
Flight change notification
When CTA first studied this issue, it was clearly going to require the airlines to change their internal communication capabilities before they could comply with the rulemaking requirements. CTA is disappointed with this delay, but understands that airlines need to find ways to communicate with their gate agents effectively before the gate agents can talk with passengers.
24-hour reservation refund provision
While many airlines already comply with this provision, there is strong backlash from the low-cost carriers who often sell low fares at the last minute. Offering passengers a blanket 24-hour refund policy would dramatically shift their business plans. Though there is some regulatory relief bases on the time of purchase of the airline tickets, there is evidently more work to be done on the airline side.
The march toward airline price transparency is still moving forward. Since the DOT announced the new upcoming proposed rulemaking, there is lots of positioning and informal discussions being held between consumer, travel agent, central reservation system and airline representatives. CTA remains hopeful that a strong rule will emerge next year that will provide consumers the ability to compare the full cost of travel across airlines and allow the free market to work for the benefit of passengers.
