IATA’s de Juniac Warns Against Regulating Overbooking
Jackie Reddy November 07, 2017
The practice, says IATA’s chief executive, protects profits and is “key” to ensuring the continuity of a carrier’s operations.
The International Air Transport Association (IATA) has warned Canadian authorities against attempting to regulate overbooking, reports the Financial Post. The nation’s government is attempting to institute Bill C-49, which would clarify passengers’ rights with respect of overbooking. But in an interview, Alexandre de Juniac, IATA’s director general and chief executive, said that, “There is absolutely no need to regulate overbooking.”
He added, “This is the airlines’ position based on a long, long experience. The need for airlines to overbook in managing their seats, their revenues, is key.”
C-49 passed through the nation’s senate this week and despite de Juniac’s objections, Marc Garneau, Canada’s transport minister, is eager that this new legislation spells out exactly what rights passengers have in the instance of overbooking. “I have been clear that regulations would include provisions whose intent would be that any denied boarding due to overbooking is done voluntarily and that under no circumstance (should) someone be involuntary removed from an aircraft after they have boarded,” he said.
But overbooking, explained de Juniac, is actually an important part of a carrier’s operations, as it enables airlines to protect profit margins by ensuring that plane’s are full. Thanks to technological improvements, overbooking, he said, “almost never happens now.” Furthermore, de Juniac added that “market forces are a very strong incentive” in terms of protecting travelers.
Jacob Charbonneau, CEO of Flight Claim, a passenger rights group, believes that, as a piece of legislation, C-49 should be expanded. “It would also be appropriate to follow the lead of the European legislation in establishing a separate procedure when an airline has overbooked.”
This model would provide compensation for delays and cancellations as well as for overbooking. But de Juniac again protested, saying that this style of legislation, “…goes too far in terms of refunding passengers for delays, even when you are not responsible for the reasons for the delay. It’s too much of a heavy burden on the shoulders of the airline.”
However, he also added, “We have to find the right balance between passenger protection and airline protection.”
But the proposed legislation does nothing to prevent airlines from overbooking. It merely lays out clearer minimums and procedures around IDB and VDB situations. And it is still not as customer-friendly as current rules in the EU. Our friend at IATA needs to stop trying to reset the clock while speaking out of both sides of his mouth.
You'd think that, if overbooking “almost never happens now", de Juniac would have nothing to complain about.
As a frequent passenger, I which these so-called "passenger rights" groups would stay out of my business. The market usually works quite well when left alone, and legislation rarely fixes anything. Personally, I love overbooking. Whenever practical, I plan my itineraries to ensure that I am available to volunteer my seat when needed. More often than not, when the gate agent announces an oversold flight, there is a rush of passengers willing to give up their seats for a voucher. In the past five years, I have claimed about $10,000 in vouchers. This means that my wife and/or kids can often accompany me when business takes me somewhere nice. I can also use the vouchers to help friends and relatives who may not have the wherewithal to travel on their own nickel. The status quo is just fine with me.