A major airline trade organization is urging the Trump administration to put an end to a federal review that could require airlines to compensate passengers in cash for lengthy flight delays.
According to Business Insider, Airlines for America (A4A), which represents 10 carriers—including such industry giants as Delta, American and United—sent a letter to the Department of Transportation (DOT) on Monday calling for the review to be dropped.
The review, initiated by the Biden administration in December, is gathering consumer feedback on whether airlines should be forced to provide passengers with cash compensation when significant disruptions occur through the fault of the airline.
Proposed remuneration amounts include payouts of $200 to $300 for delays of at least three hours on domestic flights, $375 to $525 for six-hour delays, and $750 to $775 for delays of nine hours or more. Similar regulations already exist in Europe and Canada.
A4A is pushing back against these potential regulations, arguing that they would do more harm than good. The group claims that forcing airlines to issue such compensation would likely push ticket prices higher and cause an increase in flight cancellations when lengthy delays are unavoidable.
"Airlines do not need further incentive to provide quality service," the letter reads, emphasizing that carriers already offer automatic refunds when passengers choose not to rebook following a flight cancellation. It pointed out that carriers also provide passengers with meal vouchers, hotel stays or ground transportation in cases of severe disruption.
However, during an interview with TravelPulse late last year, experts from AirHelp, (a company that assists consumers with claiming compensation they're due from airlines) said industry claims about ticket prices be driven upwards by the proposed measure are vastly overstated.
“Data shows that the actual cost per passenger to fully adopt these
regulations in the U.S. would be between $0.40 - $0.90 per flight,” AirHelp’s chief legal officer, Eric Napoli, told TravelPulse. “For less than $1, U.S. air passengers would be able to have
the same passenger rights as their European counterparts.”
A4A also argues that the proposed rule would exceed the bounds of the DOT’s authority and would be "directly contrary to President Trump's regulatory policies and directives" seeking to reduce nonessential federal regulations.
Back in December, the Biden administration’s Transportation Secretary, Pete Buttigieg, opined that establishing compensation rules for severely delayed flights "would change the economic incentive in a way that motivates airlines to do more."
The Biden administration made consumer protections a key focus in its policies regarding air travel. In April, it implemented a rule requiring airlines to automatically and promptly issue cash refunds when passengers are owed them. The DOT also levied a $2 million fine against JetBlue in January for operating chronically delayed flights.
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