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Airlines would provide refunds for late bags under US plan

Wednesday, October 19, 2016 - 09:20
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The Obama administration unveiled sweeping new consumer protections for airline passengers on Tuesday that would give travelers refunds when bags arrive late, require carriers to release more information about tardy flights and make purchasing tickets more transparent.

[WASHINGTON] The Obama administration unveiled sweeping new consumer protections for airline passengers on Tuesday that would give travelers refunds when bags arrive late, require carriers to release more information about tardy flights and make purchasing tickets more transparent.

The government is also planning to require air carriers to report more information on wheelchairs it loses or damages, and clearer data on the percentage of bags that get lost on flights.

"We are committed to a system of fair treatment and fair play for the 700 million passengers that will board 9 million domestic flights this year," Transportation Secretary Anthony Foxx said at a White House briefing. "These new protections will do just that."

The combination of executive actions and proposed rule changes are the third major effort at improving air-passenger consumer protections by the Obama administration. Some of the consumer measures - which were immediately criticised by airlines - would take effect soon while others, including the late-baggage proposal, may take more than a year.

AIRLINES' RESPONSE

"Airlines have different business models and must be allowed to continue offering optional services in a manner that makes sense for both their customers and their business," said Nicholas Calio, chief executive officer of Airlines for America, a trade group representing most large carriers, in a statement. "Efforts designed to regulate how airlines distribute their products and services are bad for airline customers, employees, the communities we serve and our overall US economy."

Delta Air Lines Inc, which severed its ties with Airlines for America last year, said it already complies with many of the proposals put forth by the government or is willing to do so.

That includes reporting the reliability of its regional airline affiliates. The airline said it opposes an administration plan to examine the withholding of fare information from some online ticket sellers, saying it needs the flexibility to cut off information from websites it calls "bad actors."

The nation's other major carriers - United Continental Holdings Inc, American Airlines Group Inc and Southwest Airlines - didn't immediately respond to requests for comment or referred to their trade group's statement.

ADDITIONAL FEES

Since a round of bankruptcies for major carriers in the 2000s, most have begun generating significant revenue from charges for checking bags and other services.

Last year they took in US$3.8 billion for luggage fees, according to the Transportation Department.

In response to consumer complaints about the practice, Congress earlier this year passed a measure requiring the government to examine whether to require carriers to refund bag charges if luggage arrives late.

Transportation officials are beginning that process by asking the industry and the public questions about how late bags must be for a refund to be issued, and how quickly the airlines should repay customers.

REGIONAL DELAYS

The administration also will require major airlines to include statistics on delays from regional carriers that operate under their brands. Currently, if a domestic flight operated by an airline partner is late, that information doesn't always have to be reported. The new measure will go into effect in January 2017, according to the transportation agency. Smaller carriers that don't currently report data on delays will have to do so under the plan.

As more people purchase airline tickets from online portals, the administration wants websites to disclose arrangements with airlines in which some flights are highlighted over others.

The Transportation Department didn't provide details of how such arrangements work or identify sites that take that approach.

The effort is part of an initiative by the administration to promote competition in US business, Jason Furman, chairman of the US Council of Economic Advisers, said Tuesday.

BLOOMBERG