Ahead of summer, Biden proposes rules to compensate passengers for airline disruptions
Hold music… not the tune you were expecting on your relaxing getaway. After Southwest's holiday meltdown, which saw the airline cancel 16K flights, the White House wants to keep companies accountable for passengers' troubles. Yesterday, President Biden joined Transportation Secretary Buttigieg to propose new regulations. For the first time, airlines would need to compensate customers beyond just ticket refunds.
Fly bad, my bad: Airlines would be required to compensate passengers and cover their meals, hotels, and taxis if they get stranded for reasons that are the airline’s fault. They’d also be required to comp rebooking fees for delays/cancellations.
Flight status quo: Right now airlines are required to refund customers only for canceled flights (not delayed ones). Biden said no major airlines provide cash compensation for preventable disruptions — though nine promised to cover hotels, meals, and rebooking.
Dude, where’s my plane… Weather is the top cause of flight delays, but avoidable issues like staffing shortages and technical problems caused by outdated systems led to abnormally high disruptions last year, even when skies were clear. A technical error at Southwest last month caused it to temporarily halt all US departures. Meanwhile, the Transportation Department is investigating whether Southwest set unrealistic flight schedules despite known staffing shortages.
A nudge in the wings could be overdue… If airlines have to compensate passengers more for disruptions, they might try harder to avoid delays. Southwest says it lost $1.1B because of the holiday meltdown, but it would’ve lost even more with these proposed regulations. It’s not just Southwest: last year 2.7% of all US flights were canceled, the highest rate in a decade (apart from 2020). The TSA’s expecting a record-breaking travel year on booming summer demand, but staffing shortages and delays of Boeing jet deliveries could mean more headaches.