AIRLINE PASSENGERS ARE IN A CONSUMER PROTECTION NO MAN’S LAND
Senator Blumenthal Fights For Airline Consumers
WASHINGTON, DC – Business Travel Coalition (BTC) today expressed strong support for Senator Richard Blumenthal’s (D-Conn.) Airline Passenger Bill of Rights responding, in part, to the United Airlines flight 3411 fiasco with an appropriate balance of new consumer protections and structural reform. The Senator’s bill, to be detailed at a press conference at 11:30am today in Hartford, Connecticut addresses prioritization and compensation for involuntary bumping, the role of police in removing passengers, unreasonable delays, excessive fees and unfair consumer practices. Compared with other industries, airline passengers are in a consumer protection no man’s land.
“To his great credit, Senator Blumenthal’s bill would restore airline passengers’ right to sue airlines for unfair or deceptive practices or unfair methods of competition,” stated BTC Chairman Kevin Mitchell. Such practices can include withholding ancillary fee information from travel agents, refusing to provide complete fare and schedule information to online metasearch sites upon which consumers depend for comparison shopping, undisclosed fees, price gouging, chronically late flights or health and safety risks,” added Mitchell.*
The fundamental right to sue when financially harmed is one that the U.S. Congress never intended to have stripped from consumers when it deregulated the airline industry in 1978. Moreover, it is a right that consumers exercise in every other consumer-facing industry to discourage market participants from trampling upon their interests and rights. The right to sue would put desperately needed discipline into the U.S. commercial aviation system. For example, in 2014, U.S. airline industry revenues were $169 billion and the U.S. Department of Transportation (DOT) assessed civil penalties for unfair or deceptive practices of $2.7 million that year. This represents a mere slap on the wrist.**
Last week’s mother of all customer service meltdowns was decades in the making. It is a deeply rooted cultural problem that has greatly worsened in recent years and that the major U.S. network airlines neither can nor want to solve. Some of the world’s most customer-centric airlines include Azul, Emirates Airline, Etihad Airways, Qatar Airways and Singapore Airlines. Those airlines’ cultures never in a zillion years would have allowed a guest to be dragged down the aisle like an animal bleeding with a broken nose, a concussion and knocked out teeth as other horrified guests watched.
Since the legacy U.S. airlines secured their antitrust immunities for their joint ventures, and massively consolidated the industry, in addition to the over-the-top arrogance of blocking consumer protections, their obsessive public-policy focus has been to frustrate domestic and foreign competition. For example, they are purposefully underutilizing scarce takeoff and landing slots at Ronald Reagan Washington National Airport and LaGuardia Airport to keep U.S. low-fare carriers out and scorching the earth to block badly needed foreign carrier entry to U.S markets.***
Airlines have fought virtually every consumer protection proposal at DOT, in federal court and in Congress. United Airlines alone in recent years spent $41 million in campaigns to undermine proposed consumer protections. In a consolidated industry consumers need increased protection as tacit coordination on strategy and policies among a small group of competitors can make anti-competitive and anti-consumer behaviors easier to conduct. To reverse the decline in respect for airline customers it will take a combination of (1) stronger consumer protections, (2) the restoration of the right of consumers and State Attorneys General to sue airlines and (3) increased domestic and foreign airline new entry.****
*See more examples of unfair or deceptive practices at http://btcnews.co/1YbkC53.
**See BTC research into restoring a private right of action at http://btcnews.co/1QuapL2.
***See utilization charts at Reagan Washington and LaGuardia at http://btcnews.co/2m0zEia/