Aerospace engineer and Fear Factor alum Danielle Stephens Vlasica was flying American Airlines flight 758 from Philadelphia to Athens and the flight was overbooked. The airline kept upping the voluntary compensation offer to get three people to give up their seats. Here they’re at $3,600 but “they ended up going to $4500 per person” to take a flight the next day.
This is highly unusual for American and something you see far more often on Delta. Delta generally will not involuntarily bump anyone. They’ll keep upping their offer until someone takes it. American is much more likely to stop bidding and pay out the legally minimum required compensation, leaving passengers behind involuntarily.
In fact, American Airlines usually stops the bidding with their third offer, requiring the gate to get outside approval to go higher, with an eye towards cost control.
Airlines are much better at managing their oversales, so bump compensation isn’t as frequent as it used to be. Nonetheless, here’s a flight where Delta handed out over $43,000 in compensation. Here’s one where they paid out $63,000. One Delta passenger last year paid off their car by taking a bump off of a Delta flight.
Good for them. However, since Dr. Dao, airlines have increased their maximum payouts to $10,000, so… Overbooking is one thing; delays and cancellations under the control of the airlines are another (think, staffing issue, failing to properly maintain the aircraft, etc.) If the delay was significant enough, say, 4+ hours for a TATL flight… that could mean $250-700 per passenger owed under EU261. We really should have something like this in the US. Watch as miraculously less flights are delayed when the incentives align better. Hmm.
$4.5K. I’d take that in a heartbeat.
Which will be achieved by airlines dramatically reducing the number of flights and steeply raising fares to make up for the difference. Otherwise known as the Law of Unintended Consequences.
In situations like this, it’s usually best to ask for a cashier’s check or a Visa or Mastercard physical gift card that can be converted to cash at an ATM. At a minimum, ask for airline miles at a valuation of at least 1 cent per mile.
Travel vouchers often come with major drawbacks: blackout dates, expiration periods (typically within 12 months), and restrictive terms. Some vouchers are single-use only, meaning if you use a $4,500 voucher to purchase a $300 ticket, the remaining value is forfeited.
Many prepaid Visa, Mastercard, and American Express cards also have significant usage restrictions and may not work everywhere.
Airlines are generally not required to offer cash or cash equivalents for Voluntary Denied Boarding (VDB), even though they are required to do so for Involuntary Denied Boarding (IDB). The fact that they can compensate passengers in cash for IDB situations shows they have the capability to do it. In VDB cases, however, they usually default to vouchers unless passengers firmly insist on cash compensation, or better yet, when multiple passengers push for it together.
This is one if many reason why profits are so declining. This is because if overtakes of tickets. That is selling more seats than is available which is based on how many people dont show up or cancel for a particular flight. I can see 1 or 2 seat oversales but 8 and 10 oversales is unreasonable and illogical.
@Denver Refugee — No, in reality, that’s when airlines like Ryanair become one of the largest and most profitable airlines in Europe by offering dirt-cheap fares, and they still comply with such rules, too. You know better.
@ Denver Refugee , that is just not true in Europe and Japan, were these rules already exist.
@Toilet Paper Man — I wasn’t even aware of the Japanese rules for compensating passengers on overbooked or significantly delayed, canceled flights, and just assumed it rarely happens there, because even a 15 minute delay would result in dishonor, the worst punishment of all.
I sure would take $4,500 for a Bump!!! The most ever that I got on AA was $1,200. In the old days, TWA would give you a System-Wide Voucher if they needed you to take a bump. It had no specific value but was great because it got you a seat ANYWHERE, they flew. We used to get bumped on little flights like BOS-JFK, but we used the System-wide vouchers to fly BOS-Cairo, Tel Aviv, Athens, Hawaii, you name it. TWA was the only airline I knew that gave you System-wide vouchers for a bump. We would look at the TWA magazine with its detailed flight maps of the world and pick our destination from the plane. I miss the airline magazine in the back of the seat pocket.
@ 1990
Here you get a payment on the spot. In Europe you get a claim.
$4500 is the gross not the net. Federal/state/local caesars get a cut.
@SOZ – actually, denied boarding compensation isn’t taxable https://viewfromthewing.com/denied-boarding-compensation-taxable/
@Gary_Leff Old equivocal analysis. I stand by my statement.
Someone claiming they were on the first season of Fear Factor back in 2001 needs to get off that pony….
@ BBT — Delta gives AMEX cards. I just use them to pre-pay my electric bill. $4,500 would last for 2 years or so. Even in the extremely unlikely event I choose to move and disconnect the service, I would receive a paper check for any credit balance. This could actually be a good way to ramp up your credit card spend in states where natural gas and electricity is deregulated, allowing you to periodically switch providers without penalty.
@Gene. I am not saying it completely useless.
But won’t you be better off if you got $4500 in cash and had the flexibility to use it anyway you want.
Overbooking is estimated to drive revenues up by $1.4 billion or more in annual revenue industry-wide. If you are helping an airline out of a jam because of a vastly lucrative practice they indulge in, that’s the least they can do.
@jack the ladd — Sounds like EU261 needs to be made even more efficient! I am all-in-favor of automatic compensation for significantly delayed or cancelled flights. Great idea!
@ 1990 — You are starting to sound like Timmy.
I’m in BBT’s camp…cash is KING.
Having done 35 years of mostly non revenue travel I witnessed many of these events, sometimes from the cockpit, but being NR travel no “soup” for me.
One question I want to throw out there. If first to take the offer ($3600 in this case) does that person(s) get the $4500 offer the other pax held out for? Since I no longer even attempt to travel NR I’d like to know what my options are.
@ One Trippe — All utilized volunteers are paid the highest amount accepted.
Alaska offered me a 15 dollar credit to fly out 2 or 3 days later
Is that a good deal? lol