chrisl137

And they can't because businesses that do a lot of travel are willing to pay more for tickets that they can change (or pay for change fees) rather than eat the cost of tickets that they buy but don't fly. I don't fly nearly as much as many people on FT, but I've had long periods where I didn't once fly the itinerary as originally ticketed, usually purchased less than a week out and for travel less than a week. Either the outbound or return ended up getting changed (sometimes multiple times) on short notice, many times after I'd already checked in. If the airlines didn't oversell, they'd have inventory that was very likely to spoil because of travel patterns like this.

Loren Pechtel

I do think IDB should be very rare. I'm not saying airlines shouldn't be allowed to overbook (the reasons they do this have already been presented and are valid), but rather that the airlines should be made to look much harder for VDBs. Scrap the current IDB rate and replace it with a sliding rate. Pick a target level of IDBs, if last year's rate was above this the IDB fee goes up 10% + the inflation rate. If it stays under the target rate for 3 years the rate goes down 10%.

LarryJ

According to the US Department of Transportation, in 2014 there were 55,000 involuntary denied boardings out of 602,805,000 passengers boarded by the largest US carriers. That's a IDB rate of 0.08%.

From Webster:

fraud
a : deceit, trickery; specifically : intentional perversion of truth in order to induce another to part with something of value or to surrender a legal right
b : an act of deceiving or misrepresenting : trick


I believe that JetBlue is the only US airline that does not overbook.

Sopwith

I was there and I was disgusted.

So the potential effect on fares is indeed minuscule.

I guess you'd all be okay if after a long day of travel you show up at your hotel at 11:30 pm only to be told, "Sorry, we overbooked. Here's a voucher for $100 off your next stay. If you come back tomorrow we should have a room for you."

tjl

Hotels also overbook.

MSPeconomist

I think you have the decimal point wrong. One percent of 602,000,000 is 6,020,000. One tenth of that or 0.10% would be 602,000. Then 0.01% becomes 60,200, so that 55,000 must be less than that, or about 0.008%.

RustyC

There's no doubt the VDBs greatly reduce the IDBs, and some people who are usually flexible (like moi) have often been known to take VDBs. OTOH, as with everything else, it's not a good idea to apply expectations from dealing with legacies back in the day to ULCCs, and I'm sure in the case of Spirit there's one or two who took an offer without realizing they could be stuck for a day or more because the airline won't put you on other airlines except in extreme cases. They're also known as difficult to get a hotel out of. ULCCs in general are worse when things go off-track, and passenger awareness hasn't caught up.

Tchiowa

How rare is rare enough to be rare? Personally I have flown about 3 million miles and have never been IDB'd. From my point of view it's rare.

Tchiowa

So by your definition it isn't fraud. They aren't getting the passenger to part with something of value. The passenger still gets transported where he wanted to go. And he gets money paid to him for the inconvenience.

That's the opposite of fraud.

LondonElite

OP - you make several incorrect statements. First, it is not the airlines' intent to IDB anyone. Their intention is to fly with as few empty seats as possibly. Second, the practice is not hidden in the fine print, but openly disclosed on every ticket/e-ticket.

LarryJ

It wasn't my math, it was the DOT's from the link I provided. Take a look at the link and see if you can figure out where the mistake is. Did I copy something incorrectly?

Not my definition. Everyone was throwing the term "fraud" around so I thought it would be helpful to see th definition of the word.

I personally do not believe it is fraud because there is no intent to deceive, legal notification is given, and the practice is specifically allowed by the regulating agency (DOT). Others may draw other conclusions and, if they do, I think the better angle would be to lobby the DOT to change the regulations. The industry would survive just fine without overbooking but it's unlikely to happen without regulation. (It would make my commutes easier, though)

moondog

Decimal errors are common, but when called out on such, we should do our own math.

chrisl137

Hotels do overbook, and I've been walked a couple of times in the Bay Area. It probably happens more often than IDB (I've never been IDB) but is usually less trouble because you're at your destination and you or they just need to find you another room.

They also are good enough at knowing the load (since they can at least count to numbers up to a few hundred and compare them) that they start the VDB process at least 24 hours out at online check-in. I routinely get the "if you're willing to take a later flight in return for some compensation, check here" note, and on personal travel often do so. I flew at the holidays for several years on a row on a single paid HP ticket by taking a voucher and an extra couple days at my mom's house. One year I had the flu and didn't want to fly anyway, so we went to the airport (this was before there was much internet) and I went up to the desk and they said something like "Oh, you aren't in a hurry to fly? We'll give you a $400 voucher to go sit on the couch and watch TV. When would you like us to rebook you for?" I didn't even have to go as far as security or wait for boarding - win for everybody.

Often1

But the fact is that when it is pointed out to you that you have passed on clearly inaccurate data, all you do is repeat that you got it from DOT. So what?

But, to be fair, it is factually correct. However, it is deceptive. The IDB rate is <1%. It's simply vastly less than 1%.

pshuang

OP, it seems to me that your mind is pretty thoroughly made up. On the other hand, I guess my mind is pretty thoroughly made up, too, so I can't really give you a hard time.

But nonetheless I'll try a different thought experiment to try to convince you. I and many others see overbooking simply as a business practice that many airlines choose to conduct, one of many different decisions that airlines make in exactly how they want to conduct the business of commercial aviation. Statistics that have been posted in this thread suggest that only roughly 1 in 10,000 passengers are inconvenienced involuntarily (IDB rather than VDB). So using my example of a plane that holds a hundred passengers, if the load factor is 100% (every seat is filled), one passenger on one of one hundred flights is involuntarily denied boarding. Not all of those are in fact due to the practice of overbooking, but for the sake of argument, let's blame overbooking for all of those IDB's. You believe that it is reasonable, nay, morally necessary, to say the airlines are committing fraud because of this. God forbid that even 1 in 10,000 passenger should be negatively impacted by this blasphemous business decision!

According to the Bureau of Transportation, in 2015, 21.26% of flights were delayed and 3.61% of flights were canceled. (Source: http://www.transtats.bts.gov/HomeDrillChart.asp.) For my thought experiment I won't research into much greater detail, but will instead assume that a mere 10% of those canceled flights were delayed or canceled due to factors that were technically under the airline's control. Therefore, one could argue that the airline made business decisions to not adequately mitigate whatever caused those flights to be canceled. After all, the airline should have had extra crews on standby at every airport where there is a departing flight just in case an incoming flight is delayed, so as to operate the outbound flight on time. The airline should have had a spare aircraft at every airport where there's an outbound flight. There should be mechanics standing by and spare parts standing by (extra engines!). If the airline chose to not conduct business that way, it's fraud! Fraud, I say!

And if the airline is responsible for 2.126% of flights being delayed and 0.361% of flights being canceled, each of those delayed flights and canceled flights is impacting many passengers at a time. Using the same 100 passenger per plane and 100% load factor for simplicity, that's 212 out of every 10,000 passengers delayed and 36 passenger out of every 10,000 passengers stuck at their origination until the next accommodation flight.

Oh, you say that's ridiculous talk? Well, many of us think the premise that airlines should NEVER EVER EVER ("HOW DARE THEY EVEN CONSIDER IT!") sell more tickets than they have seats is ridiculous talk. An airline which overly aggressively oversells and then has to deal with the consequences made a bad business decision. Similarly an airline which overly aggressively schedules its aircraft and crews assuming there will never be any delays that will cascade into the rest of the schedule later that day, which does the absolute bare minimum of preventative maintenance rather than the amount of maintenance that generates higher reliability without excessive cost, that airline is making bad business decisions. The airline should be making business decisions that are cost effective. So overselling, if it might gain them 5% more revenue at the direct and indirect cost of IDB for 1 in 10,000 passengers, that's quite possibly a reasonable decision. Putting a spare aircraft at every airport where there's an outgoing flight, NOT a cost effective decision. But putting a spare aircraft at their hub airports, probably a cost effective decision.

I do think that businesses can make bad decisions. But there's a difference between disagreeing with the specifics of a business decision that an airline makes and considering the airline's decision to be blasphemous.