Design the new process to solve IVDB (a constructive, positive thread)
Apr 13, 2017, 6:48 am
#61
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Right, this is the issue. You can't solve a business problem with a government regulation. UA needs to treat it as a business problem. They're free to overbook, but they have to appropriately accept and assess the risk if they want to avoid big payouts. Get rid of IDB and put a rule in place for the minimum and maximum allowed for VDB (some % of the full fare that's filed). Or as others have suggested, Dutch auction. This will force UA to address their business problem and re-evaluate how much they want to oversell and on which flights. Right now, there is little incentive for them to do so.
Apr 13, 2017, 7:01 am
#62
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The "I" in IDB stands for "Involuntary". As in "mandatory". So you need something to coerce enforcement. That's called a "law", and for that you need government, as in "Congress". Fat chance of ever getting something contrary to the airlines industry's interest to make it through the lobbying process. Any meaningful change would take YEARS to enact. A market- based solution could be enacted in 48 hours.
If there were no "I", but just a "V"DB. The market would have found the appropriate price for the compensation in this recent incident.
For whatever the government does, or fails to do, the airline industry will adjust its business models, pricing structure, and CoC's to adapt. And wouldn't THAT end up better for the customer?
If there were no "I", but just a "V"DB. The market would have found the appropriate price for the compensation in this recent incident.
For whatever the government does, or fails to do, the airline industry will adjust its business models, pricing structure, and CoC's to adapt. And wouldn't THAT end up better for the customer?
An airline IDBing a passenger is roughly akin to them breaching a contract for transport. I think it's completely reasonable to provide for compensation in this case by statute, and in relation to the original cost of the service contracted for.
If the general belief of society is that the IDB payment does not sufficiently disincentivize the practice (i.e. Dr. Dao was probably only going to be due around $400 instead of the $800 voucher offered), then the solution should simply be to raise the defined amount of IDB comp. The idea that an airline should be on the hook for "whatever it takes" is unrealistic and not conducive to business as it carries an unlimited risk. The vast majority of contract law is built around the idea of there being well-defined (contractural or precedent from previous torts) consequences for breach of contract.
If the general belief of society is that the IDB payment does not sufficiently disincentivize the practice (i.e. Dr. Dao was probably only going to be due around $400 instead of the $800 voucher offered), then the solution should simply be to raise the defined amount of IDB comp. The idea that an airline should be on the hook for "whatever it takes" is unrealistic and not conducive to business as it carries an unlimited risk. The vast majority of contract law is built around the idea of there being well-defined (contractural or precedent from previous torts) consequences for breach of contract.
Part of the problem is there is not much incentive for them to tighten their business practices because they have the power to IDB.
Apr 13, 2017, 7:53 am
#63
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No, that's a floor, not a cap. If you are denied boarding and arrive at your destination more than 4 hours after you were originally scheduled to, the airline owes you at least 4 times the fare paid, up to a maximum of $1350. In other words, the floor has a cap. Even if you paid $1000 for your fare, the airline still owes you at least $1350, since 4 times the fare exceeds $1350. However they can, at least under the current rules, be glad they don't owe you at least $4000. They are, of course, allowed to pay you more, but they generally don't.
It works like this:
Take the one-way airfare. Multiply it by 4. Is that more than $1,350? Passenger gets $1,350. Less? Passenger gets computed amount.
False dichotomy. I think what most of us want is for the airline to have their "stuff" together enough to have "must-rides" worked out in advance, even if it means slinging more pax onto standby-type tickets and/or holding some confirmations until boarding time. Yes, this might mean having to have more crew around (or other arrangements in place to move them in a pinch)...but over-rationalization is the problem here.
You want airlines able to boot passengers for crew. It's better for passengers at large.
Another false dichotomy. I think JetBlue has a no-overbooking policy, and there are other options for the airlines to pursue. I think many of us would also not mind too horribly if ticket prices went up by a few percent across the board in exchange for IDBs being, at a minimum, vanishingly rare.
Good news, mission accomplished! IDBs (on United) only occur once every 25,000 flights. It will almost certainly never happen to you.
Apr 13, 2017, 8:04 am
#64
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No, this is entirely wrong. The $1,350 is a cap. If your one-way domestic airfare is $1,000, and you are IDB'd, the airline is cutting you a check for $1,350.
It works like this:
Take the one-way airfare. Multiply it by 4. Is that more than $1,350? Passenger gets $1,350. Less? Passenger gets computed amount.
It works like this:
Take the one-way airfare. Multiply it by 4. Is that more than $1,350? Passenger gets $1,350. Less? Passenger gets computed amount.
Apr 13, 2017, 8:19 am
#65
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The current method also pays the people who accept early the same amount as the final negotiated rate. A flight from CAK-ORD was oversold and I accepted at $200... they needed extra people, it went to $750... they only needed me in the end, I got $750.
*Over-entitled elite hat on* What I want to know is, are there going to be elite bonuses for being VDB'ed? Bonus miles in addition to the vouchers? Bonus dollars on the vouchers? Having your bid be worth 25% more for consideration?
I remember that the PMUA volunteer list prioritized elites to get VDB'ed when they volunteer. Do they still do that?
Now I gotta find my fireproof underwear...
*Over-entitled elite hat on* What I want to know is, are there going to be elite bonuses for being VDB'ed? Bonus miles in addition to the vouchers? Bonus dollars on the vouchers? Having your bid be worth 25% more for consideration?
I remember that the PMUA volunteer list prioritized elites to get VDB'ed when they volunteer. Do they still do that?
Now I gotta find my fireproof underwear...
Apr 13, 2017, 8:20 am
#66
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Also, for those suggesting removing all cap limits, or having a cap limit so high (i.e. $1 million) that it essentially serves in practice as no cap, here is something to keep in mind:
At some point somewhere, eventually there would be a IDB situation where the cost became say $100k plus. Obviously this would be very rare, but sooner or later some flight somewhere would result in outrageous amount that would be owed.
At that point, the airlines could then sue that the law is requiring unjust compensation that far exceeds any damages caused, and they would probably win. This could result in the whole law being thrown out the window.
To provide an analogy, if I sign a contract to paint someones house but fail to do so, then I am in violation of the contract and can be sued. However, the person who sues me can only sue for an amount that is justifiable for the damages incurred, not a random $1 billion dollars because they feel like it.
For that reason, I think a good cap would be in the $5 to $10k range.. Significant enough that it would rarely get that high, but even if it did, it would not create an undue financial burden and compensation being made due by the airline.
At some point somewhere, eventually there would be a IDB situation where the cost became say $100k plus. Obviously this would be very rare, but sooner or later some flight somewhere would result in outrageous amount that would be owed.
At that point, the airlines could then sue that the law is requiring unjust compensation that far exceeds any damages caused, and they would probably win. This could result in the whole law being thrown out the window.
To provide an analogy, if I sign a contract to paint someones house but fail to do so, then I am in violation of the contract and can be sued. However, the person who sues me can only sue for an amount that is justifiable for the damages incurred, not a random $1 billion dollars because they feel like it.
For that reason, I think a good cap would be in the $5 to $10k range.. Significant enough that it would rarely get that high, but even if it did, it would not create an undue financial burden and compensation being made due by the airline.
The whole point is to keep the customer whole and provide a huge disincentive to IVDBing people.
The actual answer is:
The current IDB system is EXCELLENT. It allows airlines to inconvenience the least number of passengers possible given the finicky nature of safe air travel.
There is no reason to change it because of one criminal getting hurt when he forced law enforcement to use force against him.
And if you think there is, especially as the frequent traveler you are:
- Do you want entire flights canceled because airlines can't move crew around? Entire series of flights operated by an aircraft delayed throughout the day?
- Do you want flights delayed because passengers think they can simply refuse to leave a plane when asked and there will never be forced used? Even if that passenger is a threat, like drunk, or sitting next to you and touching you inappropriately, or is so large they can't fit in one seat? Or would you rather fly with those people than have them forcibly removed from your plane?
- Do you want airlines to no longer have the option to overbook, and because they are forced to fly your seat empty when you noshow, require you to buy a new ticket for any flight you miss?
Seriously... we've got a good system that has worked pretty well for years, until this ONE GUY decided he was more important than everyone else, and when it finally came to having to force him off the plane because he wouldn't take a simple request to leave, he got hurt. HIS fault. No reason to make everyone else pay for it.
The current IDB system is EXCELLENT. It allows airlines to inconvenience the least number of passengers possible given the finicky nature of safe air travel.
There is no reason to change it because of one criminal getting hurt when he forced law enforcement to use force against him.
And if you think there is, especially as the frequent traveler you are:
- Do you want entire flights canceled because airlines can't move crew around? Entire series of flights operated by an aircraft delayed throughout the day?
- Do you want flights delayed because passengers think they can simply refuse to leave a plane when asked and there will never be forced used? Even if that passenger is a threat, like drunk, or sitting next to you and touching you inappropriately, or is so large they can't fit in one seat? Or would you rather fly with those people than have them forcibly removed from your plane?
- Do you want airlines to no longer have the option to overbook, and because they are forced to fly your seat empty when you noshow, require you to buy a new ticket for any flight you miss?
Seriously... we've got a good system that has worked pretty well for years, until this ONE GUY decided he was more important than everyone else, and when it finally came to having to force him off the plane because he wouldn't take a simple request to leave, he got hurt. HIS fault. No reason to make everyone else pay for it.
Well that's a certainly unique position.
Last edited by WineCountryUA; Apr 13, 2017 at 6:03 pm Reason: merging consecutive posts by same member
Apr 13, 2017, 8:44 am
#67
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The auction/bid process gets complicated by the reaccommodation (next flights, hotels, etc.) factor. "Will you for the hotel?" "If I delay my trip by one day, can I change the return to have the same number of vacation days there?" "Will you pay for the lost prepaid hotel at my destination?" "Why not put me on Southwest?" "We could route you via Canada, but do you have a valid eTA?" Too complicated.
To simplify this and get the auction system working quickly without delaying the flight, how about the airline's proposal be for the airline to invite bids to "sell back your ticket and all its remaining segments". No other reaccommodation offered.
Passengers on their final leg who only need to go SFO-SMF, perhaps they will bid a relatively small amount and drive. Passengers on the first leg of SMF-SFO-NRT-ULN in F would probably bid quite high.
Passengers departing from home who have not yet started their trip may just reconsider their entire trip and go back home with cash in pocket. MRers would love this.
Passengers who still need to go on their trip would look at the costs of purchasing alternative last minute transportation, and possibly hotels, and bid accordingly.
Passengers with very urgent needs (doctors going to perform surgery, someone carrying organs for a transplant, going to your own wedding, reporting for military duty, UMs, etc.) would not even bid or would bid the equivalent to charter a private jet.
The airline could then pick the N lowest bids, without regards for needs to reaccommodate and possibly pax being dissatisfied with the reaccommodation.
This would save precious minutes of the GA time, helping the flight depart on time, would minimize the compensation payout, and all passengers would be happy.
To simplify this and get the auction system working quickly without delaying the flight, how about the airline's proposal be for the airline to invite bids to "sell back your ticket and all its remaining segments". No other reaccommodation offered.
Passengers on their final leg who only need to go SFO-SMF, perhaps they will bid a relatively small amount and drive. Passengers on the first leg of SMF-SFO-NRT-ULN in F would probably bid quite high.
Passengers departing from home who have not yet started their trip may just reconsider their entire trip and go back home with cash in pocket. MRers would love this.
Passengers who still need to go on their trip would look at the costs of purchasing alternative last minute transportation, and possibly hotels, and bid accordingly.
Passengers with very urgent needs (doctors going to perform surgery, someone carrying organs for a transplant, going to your own wedding, reporting for military duty, UMs, etc.) would not even bid or would bid the equivalent to charter a private jet.
The airline could then pick the N lowest bids, without regards for needs to reaccommodate and possibly pax being dissatisfied with the reaccommodation.
This would save precious minutes of the GA time, helping the flight depart on time, would minimize the compensation payout, and all passengers would be happy.
Apr 13, 2017, 9:04 am
#68
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Actually, I think the ideal law would be something to the effect of "it's illegal to IDB at all, except in weight/balance issues on small aircraft where an extenuating circumstance requires the aircraft to fly with some number of empty seats." In any other industry, we'd call it fraud. Sports teams and theater companies don't sell 40,000 confirmed tickets if they know the venue only holds 30,000 people.
In reality, I know that won't happen, so the alternative is to simply make it incredibly financially painful for the airline to commit this act. There should be a meaningful minimum - say, $1000 for a 2-4 hour delay and $3000 per day for an overnight or longer delay. I'm less concerned about a cap: establishing a floor with some teeth is much more impactful. (It would be a very rare flight that sub-$1000 wouldn't generate volunteers on a short delay, for example.) But thinking of the F passenger that United threatened to handcuff - a guy on a paid F ticket - maybe there shouldn't be a cap and it should be a multiplier of the ticket value.
I don't think VDB needs *much* regulation - perhaps some basic rules to prohibit restrictions on how airline vouchers are used. I think it should be fair game for passengers to bid for miles, upgrades, or vouchers as part of a VDB process, but tricks like single-passenger, single-use, expiry dates, nontransferable, limited to certain fares, etc. should be banned. Those rules are never explained at all by gate agents: they always make vouchers sound cashlike towards any tickets purchased in the future.
In reality, I know that won't happen, so the alternative is to simply make it incredibly financially painful for the airline to commit this act. There should be a meaningful minimum - say, $1000 for a 2-4 hour delay and $3000 per day for an overnight or longer delay. I'm less concerned about a cap: establishing a floor with some teeth is much more impactful. (It would be a very rare flight that sub-$1000 wouldn't generate volunteers on a short delay, for example.) But thinking of the F passenger that United threatened to handcuff - a guy on a paid F ticket - maybe there shouldn't be a cap and it should be a multiplier of the ticket value.
I don't think VDB needs *much* regulation - perhaps some basic rules to prohibit restrictions on how airline vouchers are used. I think it should be fair game for passengers to bid for miles, upgrades, or vouchers as part of a VDB process, but tricks like single-passenger, single-use, expiry dates, nontransferable, limited to certain fares, etc. should be banned. Those rules are never explained at all by gate agents: they always make vouchers sound cashlike towards any tickets purchased in the future.
Apr 13, 2017, 9:05 am
#69
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You can easily add contingencies to the app. I bid $X if I can get on flight Y. A pax could submit several bids, up to a "no contingencies" bid. So I might bid $200 if I can get on a flight that leaves 2 hours later, $1000 for a flight that leaves the next morning, up to a completely non contingent offer of either $5000 cash or a R/T F ticket to Asia.
There should be no IDBs, only VDBs. Everyone has a price at which he or she would get off the plane. A few probably wouldn't get off for anything less than $1000000. That's fine, let them bid $1000000. The airline will pick someone else who bids lower.
There should be no IDBs, only VDBs. Everyone has a price at which he or she would get off the plane. A few probably wouldn't get off for anything less than $1000000. That's fine, let them bid $1000000. The airline will pick someone else who bids lower.
The issue isn't with how airlines currently ask for volunteers, the issue is with the amounts they are offering compared to what people are willing to accept in exchange for the disruption. The solution isn't complex, the solution is just to up the numbers.
Apr 13, 2017, 9:13 am
#71
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VDB would be a flat 6x of the base fare paid in cash or check (redeemable in terminal). All other aspects would remain the same.
IDB would be a flat 4x of the base fare paid in cash or check (redeemable in the terminal). All other aspects would remain the same.
I have only flown 4 round trips in the last 1.5 years so it might not be the best idea, but it's my 2 cents in voucher form!
IDB would be a flat 4x of the base fare paid in cash or check (redeemable in the terminal). All other aspects would remain the same.
I have only flown 4 round trips in the last 1.5 years so it might not be the best idea, but it's my 2 cents in voucher form!
Apr 13, 2017, 9:22 am
#72
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This is the problem with the IDB payout. In some (in all honesty, rare) cases, the IDB becomes an easy out when the free market would dictate a higher payout for a VDB. It becomes the government saying that meeting I miss is only worth $1350 (or whatever) when it really may cost me a lot more than that. And in that case, even if I wouldn't bite at $1500, maybe someone else would, and everyone is happy.
To keep this in perspective, it's not billions of dollars. IDB's are still relatively rare. And UA can further reduce it's risk of the higher payouts by re-working the algorithms it uses if they don't want to oversell as much.
Apr 13, 2017, 9:33 am
#74
Join Date: Jun 2015
Posts: 77
This is not a thread to discuss anything related to the recent incident. I've had enough of that. Whatever your opinions, it's time to move on to something constructive.
United's recently announced they will not involuntarily remove passengers with force (at least, that's what's being reported). I want to hear ideas on the best way for that to work.
Some possible topics:
Should the amount paid to give up your seat be increased? If so, should there be a cap? Should it continue to be offered in voucher format, should it be a no-restrictions credit, or should it be a check?
Should there be some sort of "immunity idol" designation that requires them to be left on board? An example would be specific professions - healthcare providers, first responders, etc. And should there be some sort of process by which everyone's asked to give some response as to why they shouldn't be bumped? In other words, should only people who can't give a reasonable answer as to why being bumped would significantly impact them be eligible to be bumped?
Should there be increased discussion amongst the crew and passengers about a deadlocked situation? For example, should the crew notify everyone on board that we have a passenger that cannot or will not leave and ask for more volunteers and continue to do that until the deadlock is resolved? Should the person unwilling to leave be required to stand up and give a reason to everyone else as to why?
Is there a better process by which bumped passengers can get to their destination faster? Can airlines cooperate better to handle these passengers and ensure less delay than is typical under the current system?
Please keep this positive and constructive. The goal is to design a superior process that gets the plane in the air and creates a win-win-win-win situation for the airline, the crew, the passengers who get bumped, and the passengers waiting for the situation to be resolved.
If this isn't an appropriate new thread to start, my apologies. I just think we need a forum to allow constructive dialogue about the whole process with none of the venom that we've all seen in threads about the specific incident in question.
United's recently announced they will not involuntarily remove passengers with force (at least, that's what's being reported). I want to hear ideas on the best way for that to work.
Some possible topics:
Should the amount paid to give up your seat be increased? If so, should there be a cap? Should it continue to be offered in voucher format, should it be a no-restrictions credit, or should it be a check?
Should there be some sort of "immunity idol" designation that requires them to be left on board? An example would be specific professions - healthcare providers, first responders, etc. And should there be some sort of process by which everyone's asked to give some response as to why they shouldn't be bumped? In other words, should only people who can't give a reasonable answer as to why being bumped would significantly impact them be eligible to be bumped?
Should there be increased discussion amongst the crew and passengers about a deadlocked situation? For example, should the crew notify everyone on board that we have a passenger that cannot or will not leave and ask for more volunteers and continue to do that until the deadlock is resolved? Should the person unwilling to leave be required to stand up and give a reason to everyone else as to why?
Is there a better process by which bumped passengers can get to their destination faster? Can airlines cooperate better to handle these passengers and ensure less delay than is typical under the current system?
Please keep this positive and constructive. The goal is to design a superior process that gets the plane in the air and creates a win-win-win-win situation for the airline, the crew, the passengers who get bumped, and the passengers waiting for the situation to be resolved.
If this isn't an appropriate new thread to start, my apologies. I just think we need a forum to allow constructive dialogue about the whole process with none of the venom that we've all seen in threads about the specific incident in question.
This is one of those threads that is going to take longer to read than I have time for, but the concept of the OP got my attention. I apologize if my response has already been discussed, but from the brief scanning I have done of the first page and last page, it would appear I am in the clear. Apologies if this is a redundant response.
Here's what I think should happen.
If the root of the problem truly is overbooking and / or finding seats for employees to make it to a future flight, and the airline is concerned with transporting an efficient number of passengers (as full as possible), we should look at the motivations for that efficiency.
If you care about maximizing the amount of money gained on that flight, then the solution should be NO OVERBOOKING AT ALL. In order to satisfy the "maximizing revenue" portion, a dynamic, running tally of all no-shows for every flight should be tallied and recorded on a public agency database. That was the average no-show rate for a given airline, a given flight, a given departure time, can all be calculated for a given interval (one month, one week, six months, etc). At booking, a given fare will have the base fare shown, plus the no-show rate adjustment added on and displayed prominently (by law). This adjustment rate will likely be the average number of no shows for a given interval divided by the total number of seats, multiplied by the average cost of each seat in that cabin (not sure how fare classes will factor into this, still thinking this through). That way, the airline won't have to be so aggressive in trying to pack the plane as tight as possible, and if there will be, on average, seats that are not taken, then it will be entirely possible to allow for airline employees to find a seat without having to remove someone from the plane. On average. This is not a perfect solution, but I feel that it would help to reduce the likelihood of the involuntary deboarding situation that was so widely viewed as unacceptable.
The agency of course, must have access to all data on passenger show rates, and cannot be controlled by any airline personnel. I know some folks are against increased government regulation and payroll, but a completely free market is probably not in everyone's best interest, nor is a completely regulated market.
Would appreciate some additional (hopefully positive) feedback!
Apr 13, 2017, 9:36 am
#75
Join Date: Feb 2008
Posts: 40
To me, that is the answer. And I can't see those VDBs ever routinely hitting outlandish amounts, as someone flying on a cheap ticket facing a minimal delay will have a low reserve price. It will only be in rare instances that the reserve price has to go above $1500 or so, an amount that gets paid now in certain cases.