Covid19: Swiss refunds after cancellation
Mar 21, 2020, 2:39 pm
#61
Join Date: Oct 2014
Location: Germany
Programs: *G, OWS
Posts: 214
It seems to me as if LH group is playing for time until they cann get funding by the swiss & german governement.
I've got no idea on their cash-burn rate at the moment but with no incoming payments but all their fixed costs (airplane lease payments, salaries etc.) I can't imagine their reserves lasting all that long.
I've got no idea on their cash-burn rate at the moment but with no incoming payments but all their fixed costs (airplane lease payments, salaries etc.) I can't imagine their reserves lasting all that long.
Mar 21, 2020, 2:55 pm
#63
Suspended
Join Date: Aug 2010
Location: DCA
Programs: UA US CO AA DL FL
Posts: 50,262
LX will make its merchant bank whole. Without it, it is out of business in a day because it cannot effectively sell tickets. Similarly, it will make its major corporate customers whole or it will negotiate discounts with them. Depending on the business this may be a time to negotiate a very favorable contract for future travel.
Similarly, if LX wants to push customers toward credits rather than refunds, the way to do that is to offer a credit at a premium, e.g. a credit for some percentage above the face value due. Those sitting on cash may well see that as good value. Those who need or want the cash will opt for the cash.
Similarly, if LX wants to push customers toward credits rather than refunds, the way to do that is to offer a credit at a premium, e.g. a credit for some percentage above the face value due. Those sitting on cash may well see that as good value. Those who need or want the cash will opt for the cash.
Mar 21, 2020, 3:00 pm
#64
Suspended
Join Date: Aug 2010
Location: DCA
Programs: UA US CO AA DL FL
Posts: 50,262
Having worked in another type of passenger transportation reservations system.... I suspect the long wait time has to do with the design of the system, workload capacity issues and to under promise & over deliver.
Usually vendors have a separate system to process credit card payment information because they do not want to be liable for data compromises. It provides you an integrated link or embedded into their website a third party credit card processing provider. After payment is received & confirmed, it comes back with your reservation & ticket confirmation.
Now the reverse is somewhat of a manual process. Reservations submit the cancellation request. Someone in ticketing/accounting needs to review/validate the request and determine amount to be refunded back to the credit card. After they go into their credit card payment system to manually refund the amount back to your credit card.
Some airlines integrated reservation/payment system and allows streamlined processing but tweaking the rules remain a challenge. For example SQ you can cancel your reservation with their existing IT infrastructure (i.e. $150 cancellation fee etc) and later take up with them on getting the last $150 fee refunded.
My experience with AC recently is they can take up to several months to be processed in reality took them 2-3 days. I think their 9-12 months or whatever is to under promise and over deliver as opposed to otherwise. Does not solve your issue or frustration, but hopefully provide some context.
Usually vendors have a separate system to process credit card payment information because they do not want to be liable for data compromises. It provides you an integrated link or embedded into their website a third party credit card processing provider. After payment is received & confirmed, it comes back with your reservation & ticket confirmation.
Now the reverse is somewhat of a manual process. Reservations submit the cancellation request. Someone in ticketing/accounting needs to review/validate the request and determine amount to be refunded back to the credit card. After they go into their credit card payment system to manually refund the amount back to your credit card.
Some airlines integrated reservation/payment system and allows streamlined processing but tweaking the rules remain a challenge. For example SQ you can cancel your reservation with their existing IT infrastructure (i.e. $150 cancellation fee etc) and later take up with them on getting the last $150 fee refunded.
My experience with AC recently is they can take up to several months to be processed in reality took them 2-3 days. I think their 9-12 months or whatever is to under promise and over deliver as opposed to otherwise. Does not solve your issue or frustration, but hopefully provide some context.
Mar 21, 2020, 3:11 pm
#65
Suspended
Join Date: Feb 2007
Location: PVG, FRA, SEA, HEL
Programs: UA Premier Gold
Posts: 4,783
It is one thing to take some time to calculate the refund on a partially-flown ticket as the entire ticket must be refared.
The refund has to be calculated based on pro-rata (distance flown; distance not flown).
Mar 21, 2020, 4:21 pm
#66
Join Date: Jun 2010
Location: MEX
Programs: AC E75K
Posts: 4,171
Just want to clarify though. Swiss told me that I was entitled to a refund and repeatedly denied that they were denying me one - they seemed very much at pains to look like they were not refusing me my refund. They just said it would be "placed on hold" and that I wouldn't be eligible to even ask to get it processed until December 31st. Did you actually ask them about when you would get the refund?
It seems to me as if LH group is playing for time until they cann get funding by the swiss & german governement.
I've got no idea on their cash-burn rate at the moment but with no incoming payments but all their fixed costs (airplane lease payments, salaries etc.) I can't imagine their reserves lasting all that long.
I've got no idea on their cash-burn rate at the moment but with no incoming payments but all their fixed costs (airplane lease payments, salaries etc.) I can't imagine their reserves lasting all that long.
Last edited by capedreamer; Mar 21, 2020 at 4:49 pm
Mar 21, 2020, 4:45 pm
#67
Moderator, Air Canada; FlyerTalk Evangelist
Original Poster
Join Date: Feb 2015
Location: YYC
Programs: AC SE MM, FB Plat, WS Plat, BA Silver, DL GM, Marriott Plat, Hilton Gold, Accor Silver
Posts: 16,767
Similarly, if LX wants to push customers toward credits rather than refunds, the way to do that is to offer a credit at a premium, e.g. a credit for some percentage above the face value due. Those sitting on cash may well see that as good value. Those who need or want the cash will opt for the cash.
Ok that's it. Given how many hours I've already wasted trying to reach various airlines and OTAs related to my now-defunct Patagonia trip in April, and the increasing sneakiness being employed, I'm done. Initiating a chargeback tomorrow. (Like you expressed in the AC forum, I don't generally like to default to that action as a first response, but these merchants are have exhausted all goodwill I harboured for them. I know it's very challenging for everyone in the economy right now, but consumers shouldn't be the ones left holding the bag.)
(He's concerned about some flights he has booked with LX next month. In F. To somewhere very far from Europe. So he has a lot more cash at risk than I do.)
Mar 21, 2020, 4:51 pm
#68
Suspended
Join Date: Feb 2007
Location: PVG, FRA, SEA, HEL
Programs: UA Premier Gold
Posts: 4,783
If I make a bad decision in my life (taking on a huge loan, which I cannot pay back because of some bad luck or a very terrible disease), there is no one to bail me out. Certainly not Lufthansa Group airlines. I am certainly not willing to bail them out now (with my ticket money) or through my tax Euros. Once the Coronavirus crisis is over someone else can take over the slots, leased planes etc.
It's a path of certain self-destruction that the LH Group airlines have chosen to follow.
A government bailout may safe them. Hopefully not! They were earning big Euros during the last decade. Now, they are making a big loss and I am the one paying for it. Certainly not!
I wonder at what point the credit card processors start holding back massive reserves on payments to airlines, or even just hold everything for 30 or 60 days.
A government bailout may safe them. Hopefully not! They were earning big Euros during the last decade. Now, they are making a big loss and I am the one paying for it. Certainly not!
Mar 21, 2020, 5:06 pm
#69
Join Date: Mar 2005
Location: ZRH, Switzerland
Programs: M&M, Fan of MO, Shangri-La.
Posts: 687
It seems to me as if LH group is playing for time until they cann get funding by the swiss & german governement.
I've got no idea on their cash-burn rate at the moment but with no incoming payments but all their fixed costs (airplane lease payments, salaries etc.) I can't imagine their reserves lasting all that long.
I've got no idea on their cash-burn rate at the moment but with no incoming payments but all their fixed costs (airplane lease payments, salaries etc.) I can't imagine their reserves lasting all that long.
If Swiss has to pay back most sold tickets at once, they likely only need 15 minutes and a pocket calculator to figure out that they run out of cash very soon. No income for an unknown amount of time, high cost and no demand for most of their assets is just making it a little difficult right now
If that had to be decided today, than the logical conclusion is likely to close the shop and file for bankruptcy. This then puts refunds behind salaries, pension fund (also that will now eat a lot of cash, because it works the other way around than in the US) and a few other things, meaning that there is then officially no money left for refunds.
That does not sound like such a splendid alternative to me vs. giving them some time to sort things out.
Of course I‘d love to have all my pending and already cancelled tickets refunded right now as well, but I don‘t see how a lot of arm-waving is helping to achieve that.
Maybe it helps to know that the Swiss government has the option to spend much more than most other countries because the debt is so low. They made it clear that they will spend that money and they did learn 20 years ago that airlines are crucial.
Mar 21, 2020, 5:10 pm
#70
Join Date: Jul 2005
Posts: 796
Just a quick data point:
I called the LH number listed in MMB, spoke to the agent regarding a refund. At first he told me to call OS for the refund, even though there were also LH and OS flights cancelled. I asked him if he could transfer me to OS, he said he can't, I asked him for the OS number while also looking it up online myself, in that 1 minute or so, when I found the number, I told him, its OK I found it, to which he replied, don't worry, I will process the refund now on the phone.
It is almost too easy, its a creepy feeling! He confirmed my email address to say that I would be getting a confirmation email for the refund and that it would take a few weeks rather than the usual 10 days because they are overloaded with claims.
Its been a few minutes now, and I still haven't gotten the email, I hope its not once of those cases where I have to call multiple times to chase them. Lets see...!
I called the LH number listed in MMB, spoke to the agent regarding a refund. At first he told me to call OS for the refund, even though there were also LH and OS flights cancelled. I asked him if he could transfer me to OS, he said he can't, I asked him for the OS number while also looking it up online myself, in that 1 minute or so, when I found the number, I told him, its OK I found it, to which he replied, don't worry, I will process the refund now on the phone.
It is almost too easy, its a creepy feeling! He confirmed my email address to say that I would be getting a confirmation email for the refund and that it would take a few weeks rather than the usual 10 days because they are overloaded with claims.
Its been a few minutes now, and I still haven't gotten the email, I hope its not once of those cases where I have to call multiple times to chase them. Lets see...!
Mar 21, 2020, 5:22 pm
#71
Suspended
Join Date: Feb 2007
Location: PVG, FRA, SEA, HEL
Programs: UA Premier Gold
Posts: 4,783
This then puts refunds behind salaries, pension fund (also that will now eat a lot of cash, because it works the other way around than in the US) and a few other things, meaning that there is then officially no money left for refunds.
That does not sound like such a splendid alternative to me vs. giving them some time to sort things out.
That does not sound like such a splendid alternative to me vs. giving them some time to sort things out.
Mar 22, 2020, 3:07 am
#73
Join Date: Nov 2013
Location: TXL
Programs: A3 Silver
Posts: 1,116
I see it the same way.
If Swiss has to pay back most sold tickets at once, they likely only need 15 minutes and a pocket calculator to figure out that they run out of cash very soon. No income for an unknown amount of time, high cost and no demand for most of their assets is just making it a little difficult right now
If that had to be decided today, than the logical conclusion is likely to close the shop and file for bankruptcy. This then puts refunds behind salaries, pension fund (also that will now eat a lot of cash, because it works the other way around than in the US) and a few other things, meaning that there is then officially no money left for refunds.
That does not sound like such a splendid alternative to me vs. giving them some time to sort things out.
Of course I‘d love to have all my pending and already cancelled tickets refunded right now as well, but I don‘t see how a lot of arm-waving is helping to achieve that.
Maybe it helps to know that the Swiss government has the option to spend much more than most other countries because the debt is so low. They made it clear that they will spend that money and they did learn 20 years ago that airlines are crucial.
If Swiss has to pay back most sold tickets at once, they likely only need 15 minutes and a pocket calculator to figure out that they run out of cash very soon. No income for an unknown amount of time, high cost and no demand for most of their assets is just making it a little difficult right now
If that had to be decided today, than the logical conclusion is likely to close the shop and file for bankruptcy. This then puts refunds behind salaries, pension fund (also that will now eat a lot of cash, because it works the other way around than in the US) and a few other things, meaning that there is then officially no money left for refunds.
That does not sound like such a splendid alternative to me vs. giving them some time to sort things out.
Of course I‘d love to have all my pending and already cancelled tickets refunded right now as well, but I don‘t see how a lot of arm-waving is helping to achieve that.
Maybe it helps to know that the Swiss government has the option to spend much more than most other countries because the debt is so low. They made it clear that they will spend that money and they did learn 20 years ago that airlines are crucial.
I tweeted at lucky about this because I booked the companion sale fare from AMS - JNB in April for 2000EUR each, so a total of 4000EUR. I'm fully expecting my flight to be cancelled, and any rebooking will result in Swiss asking for at least another 2000EUR. I understand that (during normal times), they don't want people booking sale fares, and then moving to peak season without paying the fare difference. But these aren't normal times. I'm more than happy to move my flight dates forward if it comes at no cost. But if I can't do that, I want a refund so that I can spend my money on something else.
Just take a look at twitter. Make a few searches by typing in a query like "extra to:FlySwiss" or "difference to:FlySwiss" and you will see lots of customers that are complaining about this.
Mar 22, 2020, 3:29 am
#74
Join Date: May 2001
Location: Zurich / Europe / New York
Programs: LH, BA, AA
Posts: 1,307
If they had more reasonable rebooking policies, then they wouldn't have near as many people clamouring for a refund.
I tweeted at lucky about this because I booked the companion sale fare from AMS - JNB in April for 2000EUR each, so a total of 4000EUR. I'm fully expecting my flight to be cancelled, and any rebooking will result in Swiss asking for at least another 2000EUR. I understand that (during normal times), they don't want people booking sale fares, and then moving to peak season without paying the fare difference. But these aren't normal times. I'm more than happy to move my flight dates forward if it comes at no cost. But if I can't do that, I want a refund so that I can spend my money on something else.
Just take a look at twitter. Make a few searches by typing in a query like "extra to:FlySwiss" or "difference to:FlySwiss" and you will see lots of customers that are complaining about this.
I tweeted at lucky about this because I booked the companion sale fare from AMS - JNB in April for 2000EUR each, so a total of 4000EUR. I'm fully expecting my flight to be cancelled, and any rebooking will result in Swiss asking for at least another 2000EUR. I understand that (during normal times), they don't want people booking sale fares, and then moving to peak season without paying the fare difference. But these aren't normal times. I'm more than happy to move my flight dates forward if it comes at no cost. But if I can't do that, I want a refund so that I can spend my money on something else.
Just take a look at twitter. Make a few searches by typing in a query like "extra to:FlySwiss" or "difference to:FlySwiss" and you will see lots of customers that are complaining about this.
Mar 22, 2020, 3:44 am
#75
Suspended
Join Date: Mar 2002
Location: Canada, USA, Europe
Programs: UA 1K
Posts: 31,452
Can you please slow down with your unsubstantiated claims of acquiring banks and refund withdrawals. I don’t believe we have any confirmation at all, and you speculation is really not helpful.