Change Fee Increase to $200/300
Sep 24, 2015, 8:48 am
#556
Join Date: Apr 2015
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Posts: 4,094
And as far as "because they can", I am having trouble thinking of any alternative basis on which a business should price what it sells besides what consumers are willing to pay for it. Are you proposing government price controls?
Sep 24, 2015, 10:29 am
#557
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The concept of price gouging is absolutely prohibited by Federal law under 49 USC 41712 covering unfair and deceptive practices and unfair methods of competition that "causes or is likely to cause substantial injury to consumers, cannot be reasonably avoided by consumers, and is not outweighed by countervailing benefits to consumers or to competition."
The airline industry as about as far from perfect competition as any industry can get. Not even remotely close.
The airline industry as about as far from perfect competition as any industry can get. Not even remotely close.
While there are some state law statutes that prohibit price-gouging during natural disaster events (i.e. doubling water prices after a hurricane) there are none that apply to routine fees imposed by common carriers (not to mention that SCOTUS has repeatedly ruled that federal law preempts state law relating to airline contracts).
I don't think anyone on FT is excited about paying change fees. But that does not make them illegal, or even bad business.
Sep 24, 2015, 11:19 am
#558
Join Date: Sep 2003
Location: LAX
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Sep 24, 2015, 11:30 am
#559
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My point is that the change fee is not anchored to any actual cost or revenue loss. It is simply charged "because they can." In other words, they're willing to give up the seat for $180. Once you don't want it, it's worth $200 plus whatever they get when it's resold.
I don't understand why the fact is even relevant to whether or not a change fee is reasonable. You could possibly liken it to a deeply discounted retail item sold as 'final sale.' The difference is that I've actually received something of value in the end. While I can't return it, I can re-sell it or get whatever marginal use of it I might like. Now, if an airline allowed me to re-sell my seat then we're talking. But we can't so...there's that.
Is there any sense that - at some point - these fees are simply punitive and unreasonable? Where is that line? $500? $1,000? $10,000? It wasn't that long ago that change fees were $50 (and still are for many foreign carriers). The question is not "why is there a fee" but rather "what fee would be reasonable."
Again, why is that relevant to whether the change fee is reasonable? You could make the same statement when the fee was $50. You can still make the same statement when the fee is $10,000. Is the argument that, hey this is your fault so we can charge you any amount we'd like?
I don't understand why the fact is even relevant to whether or not a change fee is reasonable. You could possibly liken it to a deeply discounted retail item sold as 'final sale.' The difference is that I've actually received something of value in the end. While I can't return it, I can re-sell it or get whatever marginal use of it I might like. Now, if an airline allowed me to re-sell my seat then we're talking. But we can't so...there's that.
Is there any sense that - at some point - these fees are simply punitive and unreasonable? Where is that line? $500? $1,000? $10,000? It wasn't that long ago that change fees were $50 (and still are for many foreign carriers). The question is not "why is there a fee" but rather "what fee would be reasonable."
Again, why is that relevant to whether the change fee is reasonable? You could make the same statement when the fee was $50. You can still make the same statement when the fee is $10,000. Is the argument that, hey this is your fault so we can charge you any amount we'd like?
It's not price gouging and it most certainly isn't unfair or deceptive so long as change fees are disclosed. DOT rules require the disclosure and the disclosure is made (multiple times, I might add) between reviewing a routing and purchasing a ticket.
We all get it. Everybody wants to fly F in a lie-flat seat with lounge access and a chaufered car for $5. Nobody wants ticket restrictions such as change fees.
WN, for example, has tried to compete by not charging change fees and it holds its own but can't really dislodge any incumbent carrier.
Get rid of change fees or reduce them to their actual cost to the carrier and that's the end of the deep discounted tickets which many individuals rely on for leisure travel and businesses rely on for travel costs which can show ROI.
The issue is easily fixed by simply reinstituting the CAB and repealing the ADA. Set a fee per mile, have the government approve fares and there won't be any "gouging". But, fares are lower in today's dollars than they were back in 1984, when ADA largely repealed government fare regulation and those pesky discounts came into being.
Sep 24, 2015, 12:49 pm
#560
Join Date: Sep 2005
Location: JZRO
Posts: 9,169
I'd gladly pay United $300 to change a ticket—so long as they gave me $300 every time they changed my ticket.
Sep 24, 2015, 2:08 pm
#561
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The change fee is a component of the fare pricing. Definitely not a penalty.
Sep 24, 2015, 2:27 pm
#562
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Also I believe that is a so called "illegal connection" (too short). IF you don't make the connection UA may argue any expenses you encore are on you. This has happened to a family member of mine at JFK.
Sep 24, 2015, 2:32 pm
#563
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There is certainly no need to lecture anc-ord772 on what an illegal connection is
Sep 24, 2015, 3:21 pm
#564
Join Date: Jan 2005
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In the end, it's about extracting maximum value from each traveler, which results is maximum revenue for the airline. It's basically the same rationale for offering a rebate for turning in a worthless old mattress or cell phone. People with mattresses and phones are generally not willing to spend as much on new items as those without them.