DOT Consumer Protection Proposals Stir Love, Hate In The Industry

by Michele McDonald

“Dictating to the airline industry distribution and commercial practices would only benefit those third parties who distribute tickets, not the flying public,” said Airlines for America. 

Almost every sector of the industry that comes under the Transportation Department’s bailiwick found something to dislike in the DOT’s rather lengthy series of new regulatory proposals.

ASTA expressed disappointment that “DOT is further delaying regulation on the disclosure of fees for basic ancillary services at all points of sale, an issue it has been studying for over five years,” it said in a statement attributed to Zane Kerby, president and chief executive officer. “We have long urged the department to strike a decisive blow for consumers by requiring full transparency and ‘transactability’ for airline ancillary fees.”

The DOT did weigh in to the fee fracas, saying it will be conducting a rulemaking to explore whether airlines should be required to share fee information for such services or products with ticket agents, “so that customers can get an all-in-one price when they shop online.”

It also will determine which fees must be included, such as baggage fees, seat assignment fees and change and cancellation fees.

The Travel Technology Association, which represents online travel agencies and GDS companies, applauded the department’s request for information from consumer and industry groups on whether airlines unfairly restrict access to schedule and fare information.

Some airlines have chosen to limit the number of online travel agencies through which they distribute. Delta, for example, has cut ties to several OTAs that it says do not provide “quality shelf space.”

Airlines for America, the U.S. airline trade organization, warned that some of the proposals that would prohibit airlines from withholding data from some OTAs flirt dangerously with reregulation of how airlines sell their products, driving up the cost of air travel. “Dictating to the airline industry distribution and commercial practices would only benefit those third parties who distribute tickets, not the flying public,” it said.

The DOT also issued an Advance Notice of Proposed Rulemaking to require airlines to refund baggage fees when a passenger’s luggage is “substantially delayed.”

The department did not define “substantially.”

It also released new final rules that will provide consumers more information and “prohibit airlines from cherry-picking data about their performance.”

The rules will:

  • Require the big U.S. airlines to report performance for any plane that flies under their banner, ensuring that the large carriers have to faithfully report on all domestic flights under their brand, not just the ones they select.

To meet this goal, the new rule will require the big airlines to report data for flights of their domestic code-share partners (flights by generally smaller, regional airlines that are sold under the brand of the larger airline) to make these airline performance reports more complete.

  • Prohibit online ticket agents—the platforms on which many consumers compare and book flights—from undisclosed biasing of flight offerings.
  • Require large U.S. airlines to report on how often they mishandle wheelchairs so air travelers with disabilities can easily compare carriers and make informed travel decisions.
  • Overhaul the methodology large U.S. airlines use to report mishandled baggage, so it better informs passengers of their actual chances of receiving their checked baggage in an acceptable and timely manner.

Currently, the airlines tally passenger reports of lost baggage and compare that to the overall number of travelers. Under the new rule, they will be required to report the total number of mishandled checked bags and the total number of checked bags.

The department said that it will, “in the months ahead,” finalize rules that will address:

  • Whether to require travel agents to adopt minimum customer service standards, like the right to cancel a reservation within 24 hours and receive a prompt refund.
  • Whether to define what type of entity the department considers a ticket agent, to make it clear that all companies that market air transportation must follow the same consumer-protection rules.
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