U.S. Dept. of Transportation Secretary Ray LaHood proposed new consumer protections related to overbooked flights, fare displays in advertising, checked bags and cancellation fees.
Here are some of the changes LaHood proposed Wednesday:
- Airlines would be required to inform travelers when they are booking flights whether they would have to pay fees for up to two checked bags;
- Carriers would have to provide special notice when increasing bag fees;
- Airlines would have to fully and prominently display refunds and expense-reimbursement policies in the event bags are not delivered on time;
- Passengers would receive up to $650, up from $400, if they are bumped from certain domestic flights; and they would receive a maximum of $1,300, up from $800, when kicked off certain international flights when they are overbooked;
- Travelers would be able to make and cancel flight reservations within 24 hours without owing any fees;
- Airlines would be barred from increasing ticket prices after tickets are purchased; and
- Carriers would be required to display the full price -- including government taxes and fees -- per ticket in advertising.
The Interactive Travel Services Association
, which represents global distribution systems like Sabre
, as well as online travel agencies, picked up on the transparency issue, and released the following statement:
"The Interactive Travel Services Association commends Secretary LaHood for his commitment to making airline fee information more transparent to consumers. We strongly share the Secretary’s view that consumers should be able to see all of the ancillary fees associated with their air travel before making a purchase, regardless of whether they use the airlines' own websites, traditional travel agents, or online travel agencies.
"ITSA’s Global Distribution System members powered nearly two-thirds of the nation’s domestic airline passenger revenue through agency channels in 2008; therefore, the interests of consumers who transact business with online and other travel agencies must be as fully protected as the one-third of consumers who deal directly with airlines. We look forward to working with DOT to ensure that all airline passengers have timely and complete access to all airline charges associated with their travel."
Meanwhile, with the DOT pushing for more transparency about fare advertising and airlines' ancillary fees, the Airline Reporting Corp. (ARC) is poised to take another technology step toward making it easier for GDSs, OTAs and travel agents to process and track the potpourri of ancillary services which airlines are offering to passengers, often solely on carriers' websites and their other sales channels.
ARC is developing standards for Electronic Miscellaneous Documents (EMDs) which would enable travel agencies of all stripes to settle payments with the airlines for the sale of these ancillary services. The services might range from checked bag and airport lounge access, to premium seats and onboard Wi-Fi, among dozens of others.
ARC spokesman Allan Mutén says ARC, which is owned by the airlines, is on track to introduce the EMDs to the industry in October.
In July, Mutén says, ARC will give all 188 of its participating carriers the option of testing electronic ouput, or CAT, files formatted for EMDs.
ARC is encouraging carriers to test these CAT files against their internal data systems, Mutén adds.
Even if the EMDs are introduced on time in October, travel industry adoption may be an elongated process. A critical issue will be how many airlines endorse and adopt EMDs for settlement purposes.
Some carriers may pursue a go-it-alone strategy, preferring to retain the option of selling ancillary services through their own channels only.
Mega travel management companies and corporate travel buyers in North America and Europe have complained that without widespread adoption of EMDs, it is virtually impossible to track employees' travel spending because many of the airline fees are not broken out for accounting purposes.
LaHood's proposed rule is subject to a 60-day comment period.