On Tuesday evening American published fares of $0 and $22 plus taxes and fees for business class between Washington DC and both Beijing and Shanghai.
For the most part, the expectation has been that:
- American would honor the fare for those who ticketed
- American would not honor the fare for those who merely held the reservattions but did not ticket.
Indeed, American had cancelled reservations for most people that had held the flights but hadn’t issued tickets. Wandering Aramean got his cancelled tickets which had been held reinstated. Apparently that shouldn’t have happened.
According to Traveling Better,
- American intended to cancel merely held reservations, and agents were instructed not to reinstate those as American’s intention was not to honor them.
- $22++ fares between DC and Shanghai are being honored.
However, there’s an open question it seems regarding the $0++ fares between DC and Beijing. Traveling Better suggests:
For the zero dollar fares WAS-BJS, rule 5 states we do not intend to publish zero dollar fares. Unless revenue management advises otherwise, the zero dollar fares will not be honored.
However, this goes on to suggest that in the case where the Beijing fare isn’t being honored, American’s headquarters would have unconfirmed the space. If reservations are still intact, they have not done this and indeed the statement was contingent on weighing in by American’s revenue management.
This information was updated as of Wednesday morning. American hasn’t made public statements on this issue as yet. My guess is that the Beijing tickets will ultimately be honored despite a zero dollar base fare (based solely on the fact that they haven’t been cancelled yet) though that is merely a guess and it’s interesting that the internal thinking seems to have been that they not honor the Beijing tickets — but that the Shanghai tickets would be honored.
The distinction between $0 base fare and $22 base fare tickets for business class to China is an interesting one to ponder.
And it’s an interesting discussion now about whether fares that are held but not ticketed are in fact guaranteed or can be cancelled as American has been doing. Developing…
There were also $20 PEK fares (from what I understand it was more expensive because it was a weekend fare). It’s safe to assume that they will share the same fate as the $20 Shanghai ones?
My PEK hold had a $20 base. I was told it was not going to be honored.
Gary I would think you of all people would be supportive of the idea that $0 base fares should be honored if $20 fares are, given you have quite frequently pointed out that fuel surcharges have nothing to do at all with fuel and are simply another component of the fare that can be adjusted broadly.
DOT turned DL down when they wanted to add a comment about Zero fares into their COC. I’m surprised AA has something in there. I don’t think it will stand.
I will admit this is a tricky one, but calling these $0 or $20 fares is disingenuous and leaves out the so called fuel surcharge (aka carrier-imposed fee). If it was only charging taxes that would be one thing, but at the end of the day AA did not publish a total price that results in them earning zero dollars. Ryanair just this week, in an article blogged on this site, talks about publishing $10 fares on future TATL routes. Of course, they aren’t really $10, they hit you with fees and all other sorts of crap but at the end of the day they get to advertise (although perhaps not in the US where the rules require all-in pricing) and push the press to report. Back to the issue at hand, if this was not business class, a so called 442 dollar ticket all-in would not be the craziest thing in the world, and that is what the DOT rule was originally established to protect.
I don’t think the fireworks will come here from the zero fares. Everyone who bought this tickets paid a “fare”: The “carrier imposed fee” was $350 plus whatever additional fare AA tacked on, plus taxes. That money (other than the taxes) is going to AA, so it would be completely disingenuous for AA to argue there was no fare here. At no time during the buying process was any base fare prominently displayed. The typical buyer wouldn’t have a clue of the breakdown.
The real issue here is the cancellation of the held reservations. AA.com is unusual in that you don’t get 24-hours to cancel your ticketed reservation. If you want 24 hours to finalize your plans, you put the reservation “on hold” — with the explicit promise that your seats and fare are guaranteed. This is done to comply with DOT regulations which essentially require airlines to give customers 24-hours to change their minds.
So the big issue is whether the DOT will ultimately require AA to keep its 24-hour hold promise. I think they will, because AA is clearly in violation of the DOT rules and their website’s own explicit promise.
Interesting stuff.
It would be nice if they honored held fares but I am not getting my hopes up.
I made the mistake of going home from my office to talk to my wife about it and the hold was canceled by the time time time I got there. It was a $20 fare to PEK.
This is only tangentially related, but I’m genuinely curious…
~1 year ago, AA was saying that their policy was changing so that you could cancel any fare within 24 hours of purchase.
From TPG (first site I found in Google):
“But now AA’s site says: “You may place your reservation on hold for up to 24 hours if you are booking the reservation seven or more days prior to departure.” The good news is, shortly after this change American noted that you could actually purchase a ticket and still cancel it free of charge within 24 hours whether or not you were within 7 days of departure, so there is still room to play around. It’s a slightly more restrictive policy – however, it’s one that’s more in line with the other major US carriers.”
@jamesb2147 – 24h cancellation was for flights reserved within 7 days of departure not for any ticket.
Thanks for the update! That will impact my booking practices with AA from here on out.