The Department of Transportation posted its notice of proposed rulemaking (and thus opened the ‘comment period’) on changes it wants to make to consumer protection rules.
But one nugget is included of interest to ‘travel hackers’ that could actually weaken their protections.
Cranky Flier reviewed DOT’s plans for making airline fees more transparent, even on third party aggregator sites like Kayak and Google Flights. Today he went back to those proposed rules and called them not terrible.
Cranky pointed out something that actually got me to read the proposed rulemaking.
DOT defends the policy of requiring airlines to honor mistake fares, but also calls out “bad actors” who are buying mistake fares in “bad faith.”
The rulemaking reveals the Department of Transportation’s intention to weaken one aspect of existing consumer protections.
The DOT has required airlines to honor prices, even when those prices were a mistake (14 CFR 399.88). They wanted air carriers to own their prices no matter what.
They didn’t require United to honor 4 mile award tickets to and through Hong Kong, but United displayed the ‘correct’ price throughout the booking process and only dropped price at the end.
This tilted things in a really strong direction for consumers overall. It also upended the traditional notion of obvious mistake, that no contract could have been formed if parties didn’t actually intend to strike a bargain at a particular price.
Of course in travel there are crazy prices, bargains that turn out to be much more expensive than planned when all fees are included. Spirit advertises a $9 fare club, and offers lower fares than that even — of course they have also had fees to issue tickets except at the airport (web convenience fee), to issue boarding passes at the airport, for carry on bags, etc.
In a world of $9 and under airfares legitimately offered, how can consumers be expected to discern which prices are real and which are in error? And let’s not forget $2 a night ‘easycruise’ offerings.
So it’s murky. But the Department of Transportation is sympathetic to airlines making mistakes again. And they are calling out blogs and frequent flyer forums.
The DOT is also considering exempting US connections from their rules. Consumers would only be protected on itineraries originating or terminating (or stopping for 24 hours or more) in the US and not merely connecting enroute to a third country.
This would explicitly exclude fares like the Yangon first class mistake fare that Swiss didn’t want to honor which merely connected in the US (and many passengers intended to get off) enroute to Canada.
I have no idea how the Department of Transportation is going to write a rule that would parse whether a fare was obviously a mistake to a consumer or whether a consumer was duped by a good deal that the travel provider tried to raise the price on later.
That’s going to be interesting to watch, but will end up weakening consumer protections no matter what they do (which many will say is reasonable) since it’s going to be fairly impossible to exclude cases of ‘consumers taking advantage of airlines’.
When an airline offers a deep discount sale, genuinely and with intention, if it’s actually a good deal it’s going to spread through social media. The mere discussion of the fare in frequent flyer forums is insufficient to demonstrate that a fare was known to be a mistake. Though I certainly intend to be more circumspect in the future and not offer my opinion that something might be a mistake.
And surely, my opinion on a blog — without knowledge of an airline’s actual strategies — is hardly dispositive. The late Independence Air actually once loaded a mistake fare on purpose, in the middle of the night. THey wanted for a few consumers to book it, and then reached out to the Washington Post themselves to declare they would honor the deal (‘you never know what kind of great deal you’ll find on our website’).
What do you think? Is it possible to require all fares to be honored, while giving airlines an ‘out’ for mistakes that consumers are taking advantage of (benefiting ‘too much’ from)?
Parsing this reminds me of anti-trust, where prices that are too high are exploitive of consumers; prices that are too low are predatory against other competitors; and prices that stay the same (‘don’t respond to competitive pressures’) are indicative of monopoly pricing power.
Can consumers know when they’ve hit on a ‘Goldilocks fare’ that is just right?
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