FAA Extension is Not an “Amazing Win” For Consumers, But It’s Something

I couldn’t help but scratch my head when I saw the headline. “.” Yes, the House, Senate, and President all miraculously agreed on a bill to do something. And that “something” extended FAA funding into next year. This was mostly kicking the can down the road, but there were some consumer benefits thrown in for good measure. Are they an “amazing win”? Nope.

Feel free to and follow along if you’d like. There are two primary changes that impact consumers here.

Probably the biggest benefit for consumers here is that this bill requires airlines to refund bag fees if bags are delayed. Or actually, it requires that the Department of Transportation come up with a final rule within 1 year that makes that a reality.

Bag Fee Refund

What the rule will actually say is that if a bag is delayed more than 12 hours past the arrival of a domestic flight or more than 15 hours past the arrival of an international flight, then the bag fees need to be automatically refunded. (There is apparently a little wiggle room on that cutoff, but we won’t know what that really means until there’s an official rule.)

Is this a big deal for travelers? Well it’ll be nice for some but the impact is relatively minimal.

First it’s important to point out that this has nothing to do with the original scheduled arrival time. So if you’re flying Alitalia and your flight is delayed 20 hours, it doesn’t matter. The clock starts from the time you arrive and your bag doesn’t arrive with you.

Let’s look at some numbers. In all of 2015, the airlines that report stats to the DOT (excluding Southwest which doesn’t charge bag fees) , or 120,000 per month. Keep in mind that many of these reports are about damaged bags, so it’s not just bags that are missing. I don’t know how that breaks down, so let’s be conservative and pretend they’re all bags that are delayed.

A lot of people don’t pay bag fees because they’re elite, they’re flying up front, or they have a credit card. I don’t know the specific numbers, but let’s say 75 percent of those bags were actually paid for. That’s 90,000 a month. Now, how many of those were delayed more than 12 hours? I can’t imagine it’s all that many, maybe a high estimate is 20 percent? So we’re now at 18,000. That’s worth $450,000 if the fee was $25 per bag. That’s for the whole industry in one month.

In other words, the impact on the airlines is probably negligible. But on the consumer, it will take the sting out of a delayed bag… unless that bag shows up 11 hours and 45 minutes after arrival. I’d say this is the right thing to do. It might not mean much in terms of revenue, but it just feels right. Why airlines haven’t already done this on their own, I have no idea. I’m sure they’ll blame it on technology, but they can’t use that crutch any longer.

Next up we have this idea of family seating. In short, the idea is noble. It says that the DOT…

…shall review, and if appropriate, establish a policy directing all [domestic] air carriers…to establish policies to enable a child, who is age 13 or under on the date an applicable flight is scheduled to occur, to be seated in a seat adjacent to the seat of an accompanying family member over the age of 13, to the maximum extent practicable and at no additional cost, except when assignment to an adjacent seat would require an upgrade to another cabin class or a seat with extra legroom or seat pitch for which additional payment is normally required.

Family Seating Rule

Alright, not bad, but there are so many things here that take the teeth out of this requirement.

First, we have to realize that this bill mandates nothing. Apparently it falls into the lap of the DOT to decide if this would be “appropriate” or not. I can’t quite understand what would make this inappropriate, but I’m sure there are armies of airline lobbyists lining up to show why that would be the case.

Second, this doesn’t say anything about when this seating has to be provided. In his article, Chris Elliott suggests that “this policy is certain to chip away at the billions of dollars in seat reservation fees the industry collects from passengers annually.” But is that really the case? I can’t imagine so.

If I’m an airline, I’ll guarantee this, but I won’t do it in advance. I’ll just handle it at the airport if there’s a problem. That’s how it’s done today anyway. So for families that want to guarantee seats together in advance, they’ll still have to pay for seating options. They won’t want to wait. Now in theory the DOT could get more restrictive when it issues the rule, but there’s nothing in here that would require that.

Outside of these two provisions, there are some things about improving the security experience (more capacity, Pre Check, etc), but there isn’t any particular benefit there other than “don’t have stupidly long lines like we did this summer.” So this is it.

Do you think these are amazing wins? I can’t see it that way. They’re nice little victories that may feel good but practically won’t mean all that much.

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