I worry that this would essentially make it easier for airlines to drop passengers in the long run.
Right now if your EU flight is cancelled you're entitled to a monetary compensation[1] on top getting your ticket money back. I worry that letting the airlines simply not charge you will allow them to wiggle out of this, or make the process to get it even more Byzantine than it already is.
I was one of the folks hit by the massive cancellations in Germany this summer. I'd love this new suggestion.
My flight was canceled a month and 5 days ago. It was to the US and Canada, was canceled 22 hours in advance, and would have been my first time to see my family since the pandemic – more than 3 years.
I spent 3 hours on the phone with the airline trying to find a way to my destination. In the end they offered me nothing. I filed for a refund, and the statutory compensation on the day of my cancellation. I haven't received either. The airline has ignored my dispute filing, and the website where I booked hasn't processed the refund.
A week ago, I filed a chargeback with my credit card. I haven't received any info on that.
Two days ago, I had to spend the time hiring a legal service which processes the statutory EU compensation, but they'll take a third of what I'm due (€600 of the €1800), and say it'll take 2-3 months.
The current system does not work. Even if I do in the end get my refund and compensation, I'll come out roughly break-even on costs, lost my summer vacation, and will be down a dozen hours of effort.
For the statutory eu compensation you didn’t need to hire anyone, the process is super easy, the airline by law has to have the form online, you submit it, and if they don’t answer in 3 weeks you file the complaint with the faa equivalent in the country you were traveling to, and let the airline know.
I had to do it with Icelandair, and once I told them I had filed a complaint with the government they started answering emails.
It took like 2 months from start to finish, but I got it.
> and once I told them I had filed a complaint with the government they started answering emails.
This still suggests there's a problem - companies can choose to break the law and only start following it when a tiny minority actually reports them to the regulators.
The regulation should be changed so that any regulator involvement regarding the matter implies an immediate and significant penalty, so companies are better off giving out refunds directly than waiting for them to complain to the regulator.
Yeah, this doesn’t always work. I applied for compensation from Lufthansa and they just keep replying with a “Covid times are busy” message despite threatening legal action. In the end, using a service made sure I got my money back.
> No worries, I did this a few years back and the process took a while but I got the money.
"No worries", that's perhaps fine if you have access to large amounts of cash or credit to fund replacement flights whilst you wait until the airline finally pulls its finger out. And what then if the replacement flights you booked get cancelled at the last minute? Now you're out thousands of euros.
I think the problem with the word “privilege” is it’s used in a context that suggests someone is granted something of value by virtue of their “just existing” that others don’t have.
In the case of having a money cushion this could be true if you’re born into a wealthy family and have a trust fund. But it’s not the case for someone who has built wealth for themselves. They aren’t “privileged” in this sense. They earned it.
> But it’s not the case for someone who has built wealth for themselves.
I used to think so untill I encountered:
"You young people don't know what it's like to work hard, I started with nothing and bought a house. You can't buy a house because you spend all your money on Avocado on toast."
Now I realise it's a polite way of saying 'you are an idiot'.
It's a mindset where you don't understand what life is like for the person you are trying to lecture. It doesn't matter if you are hostile or helpfull, it just means you don't understand the relevant problems.
You think avocado is relevant to house purchasing, you design benefits system for homeless people that asks for your address. You asks people how is it a problem that you need to file a lawsuit to get your money back - like who can't file a lawsuit. Or who doesnt have internet?
If you 'self-made' your wealth 20 years ago, you will have forgotten how it was, and times have changed. So it helps, but is not strictly relevant.
I don't know about Germany, but small claims courts (where this level of damages would belong) are really quite accessible. Hiring a lawyer for one is overkill.
If you can get to a public library, you have internet.
Not everything is an intractable problem, though I'll agree that avocado on toast is an unlikely reason to not be able to buy a house (though is a reasonable hyperbole for "bad financial planning", if rather insultingly dismissive).
Furthermore, "privilege" makes it sound like the advantageous state should be seen as the exceptional condition, and that social equality would be served by getting rid of the "privilege". Whereas actually, we should aspire to reform our society such that everyone has the economic power to represent themselves.
If you read enough Italian Elite Theory and some Nietzsche it pretty much comes down to a strategy to become the master class/elite of a society. Instead of earning status outright, another approach is to agitate for it using masses of people to prop you up. Hence identity politics designed by some hopeful elites to recruit masses of wannabe but never will be elites wrapped in a formal claim of justice or some other such emotional nonsense. The actual issue is “I want power over others”.
Players of RTS games will note that this is why you have to build resource storage as well as extraction - storage functions as a "shock absorber" that saves you money in the long run. (A consumer credit line is, for example, a kind of virtual/worse type of storage that is, ironically, not even available unless you already have significant flow.)
Well, it's more that resource storage allows adaptivity rather than being a shock absorber, per se.
For example, in the fog of war or the early game we don't know if the enemy is teching, econo-expanding, or rushing. In the mid-game we know an attack is coming, but we're uncertain its unit composition. So in the early game we store some resources while we scout. If we see them teching we can dump everything into military expansion since they'll have neither the army nor the production to counter any attack. Same idea for mid-game: knights -> build pikeman, archers -> build knights.
If it were merely about shock absorption we may as well have dumped it all into walls, archers, and castles.
I would describe those as shocks. I may prefer to set money aside and then fix my car before it breaks down from a transmission issue or whatever, but I don’t know that it will be a problem. In the same way I would prefer to blind counter in an RTS, but I just don’t have that information.
It’s still about lack of information. Building random units in an RTS without information is like replacing random car parts, it might work but it’s likely to be wasteful.
Of course risk vs reward can still favor replacing parts early or building units / eco.
Yeah, and there are a lot of horror stories about credit lines being cut off at exactly the times you need them. I remember one on a personal finance UK forum about someone who quit his job and was going to draw on his standing home equity line of credit to start a business but then had the request denied because "lol you don't have income anymore".
I hate to use the word 'privilege' but it applies the other way as well. Like someone is probably in a privileged position to demand immediate refund and a handsome EU compensation on top of that, many people in more unprivileged parts of the world wouldn't be so lucky to get any of that at all. Privilege arguments can go so many ways.
That happened to me last summer. I had to rebook cancelled flights with British Airways multiple times to get home. In the end i was out over £15000 pounds worth of flights. BA offered me vouchers valid for a year in replacement. In the end i called my credit card company and disputed the charges. They wanted me to pay in the interim, I refused, and a few days later Amex credited my account. 90 days later they said BA had not disputed my claims on time, and I was therefore awarded the full amount.
My flights were for me and my kids. Total of €2700. One of the flights was booked separately (because booking together didn't work on any of the websites I tried), though also American Airlines, and I won't get a refund on that. The €1200 that I'll get will only cover the extra missed flight, and my Airbnb. And that doesn't scratch that I had to find new summer vacation plans with my kids on one day's notice. That is not no worries.
Look, I am sorry this happened, but you should get the total 2700 EUR back + compensation.
"though also American Airlines, and I won't get a refund on that" <-- you should double check this, if one of the airports is in the EU you get everything back for your departure flight.
https://realworldmachine.com/travel/airline/eu-flight-compen...
"Flights must either arrive into the EU via an EU-headquartered airline or originate from the EU (regardless of airline headquarters) for the EU Flight Compensation Regulation to be applicable."
Obviously they will tell you otherwise.
Funny how people call me privileged etc. but you literally fill out a web form with flight number, upload your tickets and the solicitors handle the rest and the money gets dropped into your account within 6 months or so.
It's a lot of money, of course the Airlines are going to try to wiggle themselves out of it, so you have to fight them to get your right.
I think you will get 2700 EUR back for sure, flight compensation as well and you might even be able to claim for the BnB.
Took me ages to get mine back too - I had flights cancelled on eve of Covid, filed the refund quickly and had to deal with so much trickery from RyanAir. They’d claim I hadn’t submitted it and used some devious practices to encourage me to take a flight voucher instead. The whole process took something like 6 months iirc, every interaction with them I had they were deliberately confusing and evasive.
My cancelled 2020 flights I claimed through my travel insurance. I assume my insurance then asked for the money from the airline but that wasn't my problem at that point.
This is standard practice for RyanAir. It makes me wonder how they carry out other essential parts of their business, and has led me to refuse to fly on them for well over a decade now.
The only problem here is the need to get a lawyer and the way it takes three months.
When I don't pay a fine in 14 days it doubles. So institute the same thing with a 30 day SLA and remove any paperwork requirement when the flight is cancelled or delayed by the most excessive amount.
much worse would be they cancel you at the check-in, "sorry, overbooked, have a nice day sir", and because there was "no costs" involved, you can just go home. Hotel and car and etc that you booked for you in US and Canada, it would be gone, no need for compensation. Actually, probably they will have a clause saying that "the booking confirmation is bound to the check-in".
That's even written in the text:
"The advantages of a PAYF model for corporate travel managers, as BTN Europe previously reported, include not having to chase refunds or pay a TMC to manage this process. There’s also a reduced risk of losing money to airline bankruptcies."
A chargeback should get you the money back and that would be the end of it. It takes 30 days or so.
There’s virtually no chance they will be able to prove they provided you the service that you paid for, since the flight was cancelled. The credit card company will then side with the customer.
Have you considered getting legal insurance? Here in the Netherlands they are €10-15 a month, and in these times of chatbots, shady webshops and all kinds of services failing, they are sure to pay themselves out.
Actually the opposite might happen. Airlines would keep empty seats to sell at a premium at last moment.
A business that rejects customers willing to pay top dollar is suboptimal. The startegy today is to make artificial scarcity. If the customer has more power the strategy changes.
Interestingly airlines already do this. When airlines ask for volunteers to take the next flight, it could due to a range of factors but last-minute business travel is one. They will absolutely sell a last-minute ticket for $2,000 to a business traveler when the flight is already overbooked, then offer someone $1,000 to take another flight. Usually everyone is satisfied and the airline profits.
I’m assuming this is a joke, but if not - that’s not how Kelo worked. Kelo is bad law, and a horrible court decision, but it doesn’t mean any private company can just take your stuff…
Both happen. Keeping seats happens more often in Europe.
I flew Munich-Oslo yesterday. Look at the prices for that route for later today, for next week and for next month. The seats are the same on most of the aircraft, the available business class you see is just regular seats being kept free for expensive tickets. And when the search engine says "4 seats are left at this price", that means that the airline is keeping some to sell at higher prices.
But even though payment has not yet been finalized, you HAVE engaged in a contract with this airline. If airlines start cancelling flights maliciously, they'll be in a lot of trouble.
And even if they're not malicious. A bus company in my country got fined (or, denied millions in subsidies) because they didn't meet their target of bus routes / bus lines (they get subsidies to drive routes that don't pay for themselves). They couldn't get enough bus drivers due to the Panny-D and everything else going on.
The compensation seems to depend on having a ticket (entering into a 'contract' to provide/use a service) and not on the actual date of monetary transaction. Which shifts to check in time from booking time. Compensation for cancellation less that 14 days prior to delivery may still be in place, only the refund could be spared if cancellation happens before check in. There are pre-, on-time-, post- payment services out there working with various obligations to handle exceptions.
Currently if an airline drops you, demanding compensation is a cumbersome process but you can get it. So, e.g., if a flight was booked by too few passengers, the airline has an incentive to still honor the booking.
With this system they might as well say "today numbers don't add up so we just don't fly", and cancel with any excuse.
That's not actually different from today. In both cases the airline has a contract with each of its passengers. The contract allows cancellation on terms specified in the contract, and requires payment on the due date, also specified.
The airline has a duty to fulfil the contract once it has entered into the contract. That duty applies both before and after the payment due date (or payment dates, in many contract).
Exactly. And airlines and passengers should be allowed to pick the contract that most suites them. Instead of the government picking the 'one best' contract. One size fits none.
Germany already has a number of restrictions on contracts with regular people (corporations and certain persons are expected to look out for themselves).
For example, phone sales can't be final at that time, there has to be a 14-day grace period starting from when the purchase agreement is accessible to both parties (IIRC). Mail-order vendors have to accept returns on most kinds of goods, by law not by convention. Warranties cannot be shorter than a specified limit. Apartment rental contracts cannot ban having children, and so on and so forth.
The restrictions are real, even if most of a typical contract is still free to design and write by the parties.
This suggested change isn't larger than many of those, or groundbreaking. It's just another one like those.
Exactly at the same time I sent my cheeseburger recipe to McDonald's to implement. Ie never.
If I don't like the Cheeseburger at McDonald's, I just go eat elsewhere. No need to regulate the taste of cheeseburgers, nor exactly how many pickles or what kind of cheese should be on them.
You'd do the same with airline contracts. And people already do that, for the all the conditions that are not regulated.
Basically every airline offers the same terms, conditions and services. If you want to know what's coming industry-wide in 3 years, just keep an eye on what the most regressive is doing today.
Huh? My experience flying Singapore Airlines is very different from eg British Airways or Ryanair.
(As a customer, I only care about stuff that actually affects me. Checking what's written in the contracts and official terms-and-conditions is at best a means to an end; especially since I am unlikely to go out and actually sue anyone. Mostly, I'll just avoid airline X, if I hear that other people are having trouble with them.)
BA is a perfect example - a few years ago it was an OK airline, but it has chased the policies of RyanAir (even hiring their CEO!) to the point where they are a complete shit show.
You’re pretending there is a market where consumers have input where no such thing exists.
> ... demanding compensation is a cumbersome process but you can get it ...
Honestly this sounds like a point to address in addition?
I'm pretty sure I already give a mailing address to airlines upon booking. You could require airlines to immediately -- say, within 5 business days -- mail a check to all passengers after canceling a flight under the stated conditions, rather than letting them wait until each passenger complains individually. Maybe let passengers elect to either receive a check for $X or a travel voucher for $Y > $X when booking.
What's preventing legislation that would keep the same compensation package for cancellation? That the customer did or did not pay in advance doesn't have to impact that.
"The advantages of a PAYF model for corporate travel managers, as BTN Europe previously reported, include not having to chase refunds or pay a TMC to manage this process. There’s also a reduced risk of losing money to airline bankruptcies." sounds for me that it won't, but again, it's talking just about business customers, right?
> I worry that this would essentially make it easier for airlines to drop passengers in the long run.
That should be easy to prevent. It has to be designed so the airline (i.e. the party that holds all the power in this contractual agreement) cannot cancel the contract, but the customer's money can only be collected the moment the flight touches ground on the destination. Like a reserved amount on a credit card that car rentals use.
Flights are already "connected", it should be easy to auto-bill once the destination has been successfully reached.
I'd say airlines should use whatever model they want, as long as they clearly communicate what their policies are.
If you want to overbook like crazy and bump passengers off the plane, you should be free to try that. It's a free market, and no one is forced to fly with you.
There's plenty of tools available for customers when companies lie to them.
Those tools are applicable in many situations. Eg when Amazon doesn't send you the stuff they promised. Or when your shoeshop sells you knock-off Prada etc. It's a common problem with standard solutions.
Those standard solutions apply (or should apply) to airlines as well.
Eg when the airline gives you less legroom than they promised etc.
It is not a crazy take. Both the number of passengers arriving for a particular flight and the number of seats available on a given flight is basically stochastic. It is good and proper that airlines optimise for the maximum revenue (after some compensation for bumped passengers) and in particular the maximum number of people flown, even if that entails overbooking. (Without overbooking, more planes (with more empty seats) would have to fly to transport the same number of people - why would anyone want that?)
Furthermore, a flight might be cancelled for any number of legitimate reasons (weather, strike, technical problems, crew limitations, change in government rules, etc.). A flight is not like a car trip (even though the aviation industry has been so spectacularly successful in delivering safe and reliable flights that people often forget that).
It is foolish, in my view, to rely on making any given flight.
The idea is to only charge for flights upon checkin.
There are a myriad of problems with this, to name two:
- an attacker could easily book many flights without checking in. This would cause the airline to fly at a loss.
- customers do not control when checkin starts, airlines do. An airline could easily play tricks (checking 1hr before boarding).
Wrt the 2nd one: this is easily mitigated by having a mandatory eg 2-week period for checkin... but then we're sort of where we are today, just with more uncertainty if the bookers can actually pay for their flights.
> an attacker could easily book many flights without checking in. This would cause the airline to fly at a loss.
An attacker could easilly ask for many ambulances to random addresses, by calling from different phone numbers. They can do the same with the police and fire department, and as a result real people will die because emergency services are not avaliable.
An attacker can book hotels where you pay on arrival. They can order thousands of pizzas with cash payment on delivery.
They can probably do even order a truck full of cement if they can pull off an act.
There are thousands of possible contrived scenarios, life is full of possibilites. You aren't designing an API
This is like 'men will pretend to be transgender and be hanging out in feemale toilets' - random fictitious scenario divorced from reality.
> An attacker could easilly ask for many ambulances to random addresses, by calling from different phone numbers.
Phone numbers can be traced, and anonymous sources like a payphone are relatively rare. Getting access to more than a few phone numbers is generally going to be difficult unless they all trace to a central source (office, school, etc.) - at which point your odds of getting caught go way up.
> They can order thousands of pizzas with cash payment on delivery.
Um. Really? Is "cash on delivery" even an option where you live? I would certainly expect any sane company to get suspicious here.
There's a huge difference between exploiting a company's lack of validation VS exploiting a legally required lack of validation. The pizza company is choosing to accept cash on delivery, whereas this proposal is to force airlines. That's a huge difference and it's alarming that you don't see the relevance.
> You aren't designing an API
When you force the rule on others, I think you do owe some responsibility to think about the consequences.
> random fictitious scenario divorced from reality.
It seems ridiculous to dismiss concerns about a proposed policy by saying we have no evidence it will happen. Of course we haven't seen it happen yet: the law hasn't passed. Conversely, we have centuries of data on whether men will pretend to be transgender. Again, this is a very big difference.
I'm not against reasoning by analogy, but these are all terrible analogies.
> Um. Really? Is "cash on delivery" even an option where you live?
I can order a fridge with cash on delivery. There is a hundred of other examples.
I can come up with a fictisious 'attack' for any policy you will ever propose. The budgen is on you to argue that this 'attack' makes any sence and would be common, not on me to disprove every scenario you come up with.
You provided no argument whatsoever, why would anyone bother with this 'attack'. It doesnt. make you any money, it does nothing usefull
Swatting someone doesn't make any money. It doesn't do anything useful. And yet it still happens. The notion of people on the internet using tools solely out of malice should not be a novel one.
> I can order a fridge with cash on delivery. There is a hundred of other examples.
But again, that's an example of a corporation choosing to trust you. This is about a policy requiring it. The corporation can trivially stop sending fridges if this becomes an issue, but government policies are a lot slower to react.
I still doubt you can actually meaningfully order a large quantity of anything without providing substantial proof of your identity, to avoid exactly this sort of abuse.
You keep saying you can, but you're not providing any actual concrete examples - what specific store are you ordering these fridges from, and we can compare their policy to this proposed law. If I can really order a thousand fridges, I will happily concede the point, but I somehow doubt they'll let me.
You Can Help By Expanding It. People with user-level access to our systems are becoming less trustworthy. You can tell because abuses used to never ever happen at all.
They could implement some intermediary holding account.
Customer pays inn money, airline gets the money when the customer boards the airplane. If the customer does not board the airplane as scheduled, or and the plane has left, airline still gets the money. If customer does not board due to cancelation or similar event, money is refunded back to customer.
With modern payment systems (at least here in Europe), the transfers are more or less instant.
Yup. And if you think airlines are slow to give refunds, wait until you've chased the general public for payment for services they didn't use and don't want to pay for! Which simply means substantially more expensive tickets, and people with bad credit don't get to fly.
And still the airlines will slowball on mandatory compensation where it's owed
Isn't this what escrow accounts exist for? The airline shouldn't hold your money in the interim, someone else does. If the airline cancels, you get it back, if you fly or otherwise breach the contract (no show, cancel your ticket) then they get it.
It's basically insurance at this point, but someone just has to set up a company that buys your ticket for you and handles the legal cases (eg they pay out to you and start a reconciliation process with the airline) in the event of a default from either side.
I'm generally against making regulations that introduce mandatory middlemen, unless absolutely necessary. It entrenches a type on company into a field while generally failing to allow them to be optimized away if a better solution is later found.
But as a general option that someone could create a company for, it sounds like a good idea if its profitable.
No, having money in holdings between transactions is as standard thing to do in many situations. Fully transferring the money with a “requirement” for a refund in a “timely manor” is what we have now. With some proper committing the money 6 months before takeoff, and not getting it back until the “timely” refund lands in their bank account 6 months after the flight is canceled.
Agreed. General consumer protection laws would cover this just fine, with the added benefit of applying everywhere, not just airlines. On the other hand, airline tickets are one of the larger priced things people tend to buy regularly, so maybe it anyways does make sense to single them out.
For most people, my guess is the solution would be credit card payment where at the time of booking they take a temporary hold on the card which is only actually charged once you board. Similar to how typically with online shopping your card is only charged once the item actually ships.
This is how I understood it to work. When you buy your plane tickets now, that money goes into an escrow account and stays there until you check-in for your flight and is not released until check-in happens. This is why airlines like you to do early check-in.
Yeah but you need to provide proof of ID and the like if you book a flight; identity fraud / theft is a big deal, especially when it comes to planes, especially post 9/11. That's Homeland Security / FBI levels of shit the perpetrator would be in. And for the airline, it's just some financial impact.
Re: check-in times, that's easily solved with some legislation.
Did you pay as you boarded? Do not assume the same rules will apply when there is a dramatic change.
If a company isn't going to charge until boarding, and will charge a fee for no shows then you can be certain that they've collected identification and a payment method. Otherwise, how would they charge no shows?
Not in the UK. You can book a Ryanair flight as Mickey Mouse if you want. You just won't be able to check in unless you have a passport under that name.
They have sometimes (in London or San Francisco I noticed that) new boarding processing where you are required to show passport and boarding pass that is automatically scanned.
However everytime I see it, it delays the boarding and they skip the procedure to the default boarding pass only.
Meh not so easily, you would probably need multiple cards / identities. And to do it in a way where they can't find/sue afterward does not seem so trivial to me.
It's not like it would be the first industry where it would apply, made many hotel reservation where the payment is done only when checking.
> an attacker could easily book many flights without checking in. This would cause the airline to fly at a loss.
Yes, an “attacker” could “easily” steal the identity of 20-30 people in order to create fake bookings to disturb the a single flight one time. Though it would be easier to sneak a bomb aboard it.
Agreed with all above. I would add that this won't help customers either as regardless you paid upon check-in or not, this does not address the ultimate point for customers: go to their destination on agreed time.
It helps in two cases: ① The airline closes suddenly, as has happened twice in Germany in the past years (Swissair and Air Berlin both left many Germans with paid tickets and cancelled flights). ② the airline cancels that flight or just that ticket, in which case the airline has to quarrel with its customer(s). It's advantageous for the customers to hold the money during that quarrel.
Point 1 is a complete non-issue with a credit card, especially in the UK, where the Section 75 process is quite streamlined, but either way that liability would fall on the issuing bank/insurer at that point.
2. Also a non-issue with a credit card. If you clear your balance in full, it doesn’t really matter that they might take some extra time in getting that money back to you.
I googled a bit now and found several pages written by people who say that you can do a chargeback in these cases, and also found several pages by people who didn't manage to do it. Guess what I did not find.
I searched in German and Italian about the Swissair, Air Berlin and Alitalia debacles, and I did not find any news articles that said that credit card customers had received their money back.
Come to think of it, there might also be a press release or ad-hoc exchange notice saying "banks had to refund x billions due to visa chargebacks", I could have searched for it, so why not now? I found https://ec.europa.eu/info/sites/default/files/chargeback_rep... now, which appears to imply that if you win the dispute (should be easy), your chargeback becomes a claim against the bankrupt airline and you'll get something or nothing, depending on how much is left in the airline.
> your chargeback becomes a claim against the bankrupt airline and you'll get something or nothing, depending on how much is left in the airline.
No, you get your money back, and the bank now has a claim against the airline.
I haven't been through this exact scenario in my life, but I've been in plenty of non-delivery situations, however, I can't make a good faith claim that they were flat-out chargebacks, because on all of the cards that I made the purchases with, purchase protection or insurance was a listed benefit, namely on the Amex Platinum.
But there must be a card with similar chargeback benefits that's available to everyone in basically every EU country.
Nevertheless, there are plenty of opportunities to get your money back in such a situation.
As customer who experienced this not far than yesterday, my priority was to flight asap. Not to enter in litigation with the company ( which is incredibly painful). Moreover if you pay your ticket peanut ( Ryanair or easyJet in Europe), I doubt you will consolate yourself with that advancement.
It might make airlines a little more punctual if they don’t get paid until later in the process, and if we build in something like automatic discounts for delays.
I know the airline industry is a tough one, but I’ve had some brutal delays in my time and they do play a lot of games. I wouldn’t mind seeing a bigger stick hanging over them for consumer protection.
A couple of weeks ago I was on a flight with ryanair in Berlin. We were about to enter the "plane waiting area", you know where Ryanair herds all the people before they go onto a bus.
In front of me was a couple in the beginning of their 20s and none of them had a credit card or even debit card on them, because they had flown this flight a lot of times and they simply brought cash.
Well... their bag was slightly oversized and of course Ryainair wanted them to pay for it. So far so good, but Ryanair ONLY accepts credit cards at this point to pay for your extra luggage, so the flight of the couple was just about to bekome much more stressfull (remember this is 15 minutes before actually leaving with the plane and you literally have nowhere to do it in cash).
If I had not seen that exchange and traded cash for putting my card down, that couple would have had one sad vacation of two weeks.
All in all, airports are not equipped for this influx of "i will pay right now", because simply they are understaffed as is.
If there's a place that doesn't accept cash, it's the place's fault. Cash is what's legal tender, credit cards are the convenience. The airport is absolutely in the wrong here.
Morally you are right and I agree with you, I think it's utterly repugnant that the airline won't accept cash in a context where there's no reason not to and the situation is so stressful for the passenger.
However, the concept of "legal tender" is very limited and unfortunately could not be used here to put pressure on Ryanair. Cash being legal tender only means that it must be accepted as settlement for an incurred debt, which was not the case here. What's more, I seem to remember that technically it only means it in the context of legal disputes, such that the cash will always settle the debt if deposited at the corresponding court (or something like that).
You're right, I didn't mean that legal tender was applicable here, my point was more that cash is "endorsed" legally, as legal tender, whereas credit cards are just some third-party service.
To be fair to RyanAir, they’re extremely upfront that they’re a budget carrier and they even joke about their fees and things on social media. It seems pretty honest to me. You get what they say you’ll get.
Ah, right. I'm not sure whose fault it was, as eg the gate is the responsibility of the airport (and, if I recall correctly, has airport employees, rather than airline).
The staff at the gate is often (not always; sometimes they’re airline employees) a ground handling company contracted by the airline. They do their job based on the policies of the airlines when it comes to ticketing, rebooking, luggage rules, etc.
More generally, whenever the words "RyanAir" and "fault" show up in the same sentence/extended phrase, in 99% of the cases the "fault" is directly connected to "RyanAir", no matter who the other subjects of that extended phrase might be (clients, airports, even government entities). Though they (RyanAir) sure do have some very cheap flights, that's why lots of us accept being their reluctant clients.
Completely agree but more and more places are refusing cash. Just spent a week in Amsterdam and several places were card-only, and I've noticed that my nearby "card or cash" parking fee machines have had the cash function broken for ages..
Not only that, but a whole load of the services in Amsterdam will only accept Dutch debit cards. Which is just great when you've got a Spanish credit card (that you've used all over the world, just not in Amsterdam...)
Yeah that was really annoying with an Irish credit and debit card in Albert Heijn (and elsewhere) - though at least there I could usually find some way to give them money.
Cash is not always legal tender. (For example Scottish cash is not legal tender, it’s just accepted by convention.) and anyway ‘legal tender’ doesn’t mean a business has to trade with you if they don’t want to unless they’re settling a debt in court.
I had the exact same experience at the Delta counter in Atlanta. A Frenchman was having trouble understanding that he couldn't pay cash to check his bag. We paid for him (Amex reimburses us for Delta fees so we didn't take his cash) but otherwise he wouldn't have been able to fly.
Previously, I had always believed that in the US it was a law that places had to accept cash.
A number of years ago now, I had some RBS notes in my wallet and a young clerk in a London store told me she couldn't take them. (Her manager quickly came over and corrected her.) I did also have to get some older English paper notes exchanged at a bank for newer plastic ones.
While Euros are legal tender in the Eurozone, only France enforces universal acceptance. The only bloc-wide requirement is that public entities providing essential services to citizens cannot refuse cash payments without sufficient reason.
I'm pretty sure more countrys have similar laws. For example every place in Germany has to accept cash.
Except when paying with more then 50 coins
Except when paying with coins over 200€ (bills are fine)
Except when clearly contractually precluded beforehand.
That’s certainly not true in Germany. Even when German plaintiffs brought a case against the German broadcaster Hessische Rundfunk in the CJEU (2010/191/EU), the court ruled that cash payments could be limited in the public interest even to public entities (although they did uphold the plaintiffs right to pay in cash in that case).
Wherever you are quoting from almost certainly applies to creditors, not vendors in general.
Businesses should be required by law to accept cash for in-person transactions. Philadelphia was the first US city to ban cashless stores a couple of years ago and it was a great move for convenience and equity.
"First-world" countries require banks to provide free accounts to people who can't afford the standard fees. Maybe you should be working towards that instead of banning cashless stores.
I agree with the former, but not the latter. It's fine if stores accept credit cards, as long as they accept cash too. Hell, I wouldn't be against adding the cc fee on top of the price, so cash users don't need to subsidize cc users.
I doubt this is the case; it's easy to see the costs associated with taking a credit card because they are all upfront - e.g. a card may charge 1-5% plus a fixed fee.
However the costs associated with cash happen after the transaction and are extensive:
* Cost of the time spent 'cashing up' - i.e. reconciling the cash in a till with the transactions made,
* Cost of the time spent taking cash to a bank, or the direct cost for a cash collection business,
* Losses due to mistakes in making change,
* Losses due to fake currency,
* Losses due to staff-theft,
* Losses due to robbery,
I can imagine these easily adding up to some small percentage of the costs of accepting cash, comparable to the cost of a CC transaction.
1-5% of every transaction and bigger transactions have a bigger cut taken. With cash a lot of those things you mention are rare events and I'd imagine decent insurance covers or pretty much fixed costs. Credit cards also have problems with customers using stolen CCs, doing fraudulent chargebacks, machines go down etc. It's pretty well known that the high transaction fees needed for CC companies to offer rewards like cashback do impact prices and cash users are effectively subsidizing CC users.
I think it's very dependent on the business. In a couple of minutes research I saw one site which estimated the average CC cost to be 2.08 USD versus 0.30 USD for cash, whilst another site estimated the cost of cash handling to be anything between 4.7-15.3% of the money taken in [https://www.businesswire.com/news/home/20180130005244/en/New...]
(I think CC costs are also likely lower in Europe - cashback credit cards are less common/rewarding, debit cards are a lot more common)
In the US, maybe. EU Regulation caps interchange fees at 0.2% of the transaction value for consumer debit cards and at 0.3% for consumer credit cards, although most member States have set lower fee caps.
It's always more expensive to handle cash here. Business plans usually estimate the total cash handling cost to be 2.5%, compared to 1% for cars payments.
The world is bigger than the US and the EU. The poster I replied to also mentioned 1-5% transaction fees which kinda suggests they weren't talking about the EU...
As long as you don’t care about things like employee theft, increase risk of robberies, etc. If the government is concerned about “equity” it should set up banks for the unbanked.
> There is no federal statute mandating that a private business, a person, or an organization must accept currency or coins as payment for goods or services. Private businesses are free to develop their own policies on whether to accept cash unless there is a state law that says otherwise
I once flew from Switzerland to Thailand with Eurowings. Direct. I've had: US Dollars, Swiss Franks and Thai baat on me. As well as a digital credit card.
For some reason the airline would only accept Euros and Physical credit cards. I literally got 3 small bottles of water for free and 1 beer my neighbor invited me on the whole 14 hour flight.
That sounds... overly complicated (from Ryanair's thing); they have the customers' details (passport, address, payment details), just send them a bill or have them sign a promise of payment and send them on their way.
The difference is when they charge the card you used for reserving the ticket. On booking or later. Forget this 'paying for your extra bag' kind of thing which is a different matter.
I had a similar situation with Ryanair.
It wasn't the baggage I had to pay for, it was the check-in, which I had already done the night before and even had a confirmation email, but they just wouldn't even look at my phone.
Then there was the credit card issue, and I had to run through the airport asking people to pay for me in exchange for cash.
You could say it was pretty stressful since the gate was closing in 30 minutes.
Did anyone actually read the article? This is not about literally paying at the check-in, nor is it about not having to pay if you do not check in. It's merely about delaying the payment transaction until check-in/departure time, so that in case the flight gets canceled beforehand, the customer does not have to request a refunding (which, as we all know, can be very cumbersome) but simply won't pay in the first place.
As mentioned in other threads, I'd say this is still problematic because refunding isn't always the preferred outcome. Re-booking would be better in lots of scenarios(like you have to be someplace, even if a day late, or you already paid for accommodations that won't let you cancel), but if you hadn't even been charged, would the airline have any obligations to re-book you to your destination at the same price?
I'd say low cost flights/seat would get much more hazardous business for travelers, not knowing till last minute if airline cancels or not, with chances barely 50:50.
I too would like to see an airline burn (more like pay up properly & help fixing their/airport shit) but we have to be careful and set incentives so they are not easily gamed on one side, and won't bankrupt airlines ie due to some heavy storms on the other.
This is a terrible idea. Many people fly on tickets bought by other people. E.g. business travelers, children flying alone. So for all of those passengers, they will not be able to pay at the airport.
Moreover, not everybody is plumbed into the German banking system. If you came to Germany from abroad, is your foreign debit card going to work at the airport? Who knows!
It’s unreasonable for passengers to not know if they will be able to pay for the flight, until 3 hours before. What if their bank’s anti-fraud puts a hold on the payment? What do they expect passengers to do, get on the phone to their bank while at the check in counter?
Payment is made in advance to give passengers time to resolve payment issues. It is mutually beneficial for passengers and airlines.
You would still be required to provide a credit card, like when you book a rental car. The card will often be charged later, but the payment is "cleared" in advanced.
In Germany it would be a debit card. As I understand it preauthorization expires after some time. You cannot have a 3 month preauth. To do what you describe they would have to actually charge the card then refund it later which is... how it works now.
It is, but it's not practical for the time frames in air travel booking.
Authorization holds are valid for at most 30 days, and less than that in many circumstances (debit cards, non-travel transactions etc). The card payment industry would have to change their rules and business practices significantly, and this industry isn't known for moving quickly.
> Moreover, not everybody is plumbed into the German banking system. If you came to Germany from abroad, is your foreign debit card going to work at the airport? Who knows!
Is this really a worry? I have two debit cards (one issued in South America and another in Europe, one VISA and one MasterCard) and been traveling all over the world and don't think I've had issues with any of them for the last ~10 year or so. Used to be a bit hit&miss, but not in "modern times".
It’s absolutely an issue. I was in Turkey and could not get the luggage trolley dispenser to accept my card to give me a trolley. I had to carry my bags across the airport. Annoying, but at least it wasn’t a flight!
People come to airports from all over the world. You are going to hit every single payment edge case at an airport.
Also people in airports often have limited ability to communicate. Consider: you arrive in Germany on an international flight, go through immigration, then wish to take a connecting local flight to your final destination. When you’re in landside transit you may have no working SIM card or any kind of communications with your bank. That’s why flights are based on confirmed itineraries and not payment at the check in counter.
How would an airline capacity plan with just a reservation? Seems like a backwards approach to just mandating the airline pay you back if they fail to provide service
In this context and under German law, a reservation would be an enforceable contract between passenger and airline. If a passenger does not show up, the airline can sue for payment. Hence the proposal mostly shifts the burden of litigation to the airline.
In Germany, airlines have a strong incentive to refuse any refund. Courts are very slow to render decisions and the worst that can happen is being ordered to refund the original amount. Behaviour-correcting damages do not exist under German law. In combination this deters some passengers from pursuing their claim.
Edit: Airlines would also be ordered to pay court and lawyer fees which could be construed incentivising. Yet both fees are statutory capped and quite low for the average ticket price.
> the worst that can happen is being ordered to refund the original amount.
That just isn't true. The airlines often pretend that isn't the case, but just linking to, e.g., the site below usually make them pay without too much hassle.
Doesn't reflect well on the EU if they let companies get away with that. It's a law, and systematically ignoring them should anger the hell out of the EU. Since these are big corps based in Europe, perhaps they get a more lax treatment.
They count on people not having the energy to push through to get their money, but in my experience they pay as soon as they realise you know your rights and is dedicated enough. But it’s the main reason I never fly Lufthansa any more when I can avoid it.
Individual countries are usually left to enforce these laws on their own. Many EU countries are already subsidizing their national carriers in one way or another, so they aren't always keen to push passenger rights. For example Germany notably allowed Lufthansa to illegally hold customers' funds for more than a year after cancelling flights during COVID.
Those are passenger rights, a set of rules different from German laws of contract. Also, for cancellations there is no compensation if the flight was cancelled early enough or if the airline can prove exceptional circumstances.
All airlines starting or landing in Germany have to follow those laws. It’s inconsequential whether they are directly codified in German law or not. It’s correct that they aren’t without conditions, but I don’t think anyone think they should be. They have to compensate you if they cancel the flight less than 2 weeks before departure. I’ve gotten €600 twice after different delays or reroutings.
So while you can have opinions about the exact conditions, you can’t argue there are none.
The fact that there is an entire business model built around helping passengers claim their rights due to the reluctance of airlines to attend to their duties should already be an alarm signal.
There are sites that charge a fortune to fill an esta in on your behalf too. Just because a scam is successful doesn’t mean there’s a problem with the normal way.
I used them in the past and they worked, but a colleague told me I was being an idiot and should do it myself. He was right, at least with British Airways, there's an online form that you fill out and money appears in your account. It took the same amount of effort as Airhelp.
I would use them only after trying to do it yourself.
Does not work with low costs :) They'll just say 'extraordinary circumstances'.
My daughter was trying to come home from university this summer and they canceled her flight twice while she was in line at security. Guess what Wizzair said.
She has claims opened with Airhelp now, we'll see what happens.
I would only resort to services like that if your case is really stuck, in my experince (with 4 different airlines).
A quick e-mail to the airline with the order number, stating the expected flight plan, and comparing it with the actual flight plan and a calculated delay have always worked, even with the cheaper airlines.
> the worst that can happen is being ordered to refund the original amount. Behaviour-correcting damages do not exist under German law.
Maybe if they want to change the laws anyway, this is what they should fix instead. In particular, there should be punitive damages for everything illegal that are high enough that it's almost never profitable to break the law even if you get away with it a significant proportion of the time.
Allowing punitive damages would be a major change to the foundations of German civil law. German law (mostly and traditionally) thinks of damages as a means to make the other party whole rather than to incentivise a certain behaviour of the injurer. Hence German law is utmost reluctant to give anyone more than they suffered in losses.
Adding some obscure consumer protection rule is a much less controversial change to the law.
The traditional German legal doctrine sees the enforcement of fair business practices rather in the hands of the authorities than in those of consumers. Of course, there is little evidence of this to work in this or similar contexts.
> Allowing punitive damages would be a major change to the foundations of German civil law.
There ARE punitive damages the airline has to pay you if they cancel or delay your flight. It's EU law. See the sibling comment.
For instance if they cancel or delay a flight over 1500 km in the EU you're entitled to 400 Euro compensation on top of cost of ticket and other expenses you had due to it.
That's not punitive though. That's to compensate the traveler for caused inconvenience. It also happens to work as some form of punishment yes, but it's by far not high enough to work as a deterrence.
You are correct that the provisions of EU law can be construed as punitive damages. That’s why I emphasised the German legal tradition. Also, those damages do not apply in all possible situations of cancelled flights and they do not punish withholding refunds for no reason. If the airline cancels three weeks prior and then refuses to pay, the EU law does not apply and the behaviour we would like to disincentivise is not to honour the refund claims rather than the cancellation.
> German law (mostly and traditionally) thinks of damages as a means to make the other party whole rather than to incentivise a certain behaviour of the injurer.
Does that include payment for time spent seeking a verdict?
The whole thing came up because airlines don't pay back customers in a timely manner. It can takes months to get your money back from airlines even when the airline is fully at fault.
IcelandAir gave me a credit instead of refund when they canceled my flight in early COVID days. I called asking for a refund and was refused. The credit expired before I could use it. Why is there an expiration? This was in excess of $2000. I’ll never fly IcelandAir again.
Since Iceland is in the EU, you should check a bit more if that's allowed. I'm pretty sure it isn't and when the credit expires you should still be able to collect the original amount, at least that is what happened in some other instances to avoid liquidity crisis with airlines and holiday agencies.
Iceland, like Norway where I'm from, is part of the European Economic Area[1] through the European Free Trade Association[2], but not a full EU-member. They get access to the EU single market, by agreeing to implement EU legislation in a number of areas.
It can be quite confusing at times. For example, both Iceland and Norway are part of the Schengen agreement[3], so in that respect we're "from EU" when traveling.
Iceland is not in the EU. They are in the process of joining since like a decade but have never completed their application. They are in the EFTA and the EEA however.
According to an Icelandic friend not fully joining the EU is on purpose. There are people on Iceland that enjoys the benefits of EFTA and EEA, yet does not want to fully tackle corruption. Iceland is the most corrupt Nordic country by far (yet on a global scale still pretty good).
Well yes and no, the topmost reason is that rural folk simply are very eurosceptic there (see polls on that matter) and the election system favors them a bit, so overall, the eurosceptic parties remain in power (for now). Though I've yet to see an analysis on the matter since Russia's imperialistic invasion of Ukraine.
> “Everyone must be aware that at the time of booking you are entering into a contract of carriage that is subject to certain conditions, such as no-show and/or rebooking fees.”
They are mandated to pay you back if they fail to provide service. However, that doesn't help you in case of a bankruptcy. Paying months ahead is basically giving the airline an unsecured loan and lots of German consumers were hit when Air Berling went bankrupt. Under German bankruptcy laws even a credit card chargeback won't help you, that money is mostly gone.
"How would an airline capacity plan with just a reservation?"
Responsibly perhaps?
So they make the most effort to make sure the service is delivered since it will only be paid if they can deliver? I know it is a novelty idea paying for only the received service when received, something never been used throughout the history before as one always had to pay well in advance and then may or may not receive the service paid for, but perhaps we could get used to this very novel and revolutionary idea, no? : )
I believe this paying for something not delivered yet and run circles getting back if not delivered at all on the agreed terms is in the benefit of the airlines. Being abused many many times. Otherwise we wouldn't have needed extensive and stict regulations about compensations. This may change. There is a desire for it from customers.
Will you be okay with prices going up significantly to account for the fact that scheduling is now done "responsively" and thus efficiency is at a much lower capacity? : )
Never mind that --- how am I supposed to plan a time critical journey if I don't know in advance if I'll actually have a seat on the plane?
This kind of pay-on-the-spot only works when there's tons of capacity, if you don't take this one, you'll get the next, no problem, and where the provider doesn't need 100% usage, i.e. where costs are incremental rather than fixed.
And airplane fails that criteria in both ways. This plan is bad for both airline and customer.
You sign a contract that requires the airline to fly on a certain date and you to pay on a specified date. The only change from today in the normal case is that the two dates are the same.
The big changes are in two unusual cases: ① The airline closes before you fly, such as Swissair, Air Berlin etc. In that case you don't pay. ② The airline cancels your reservation, as many did during the early covid phase. In that case you and the airline quarrel about nonperformance of the contract, just as you do now, but you have the money during the quarrel instead of the airline offering you a voucher.
Are you saying maximizing load factors are worse for fuel economy or just slowing down would be a preferred cost saving measure in your opinion? Average load factor in the US is already <90%.
Either way, what about the unintended consequences for travellers if a slow down was mandated permanently?
You would need at least 15% more planes, pilots, ground personnel, etc... to handle the reduced bandwidth. For non-direct flights, fewer connections could be made likely increasing the airport population its ancillary services.
Airlines already do this from time to time usually when fuel costs outpaces pricing power:
When load factors get too high, recovery from irregular ops (weather, crew, or mechanical disruptions) becomes a nightmare for passengers. People end up stranded for days without available seats.
slowing down 5% adds 10 minutes flying time to a 3 hour flight. Drag varies with square of speed except when you get close to Mach 1 where it gets much worse.
Its also possible to fly 20% (36kft vs 30k) higher where drag for the same speed will be lower. Drag varies linearly with density.
An aircraft purposely designed for low fuel consumption could save 50% or more jet fuel without being significantly slower.
An 85% load factor still means you probably have a passenger sitting either side of you and a baby wailing somewhere in the distance, but now you're paying more money for your seat and arriving later.
Interesting! While the idea definitely offers advantages, I'd be keen to know what changes would have to be done in the Departure Control Systems (DCS). There needs to be connection to Customer Management (CML), Reservations (RES), Ticketing (TKT), Payment (PAY), etc...
I was employed with Amadeus Data Systems for more than 10 years, have left during COVID period.
This sounds like a big effort. I wonder how Lufthansa pulled this off in 2021...
> “The booking systems would have to be programmed and supplemented accordingly in order to enable the ‘pay as you check-in’ solution and make it the standard,” Carnier said.
Spoken like a true software engineer.
From my experience with people booking and taking appointments I can assure you, the airlines would be out of business within a month. If there is no upfront payment people just won't show up. Nobody cares anymore. The average person is too unreliable these days.
Important context: Credit cards are still much less common in Germany, and banks are not exactly very consumer-friendly when it comes to processing chargebacks.
Anyone paying a flight ticket with a non-disputable payment method (or one where the reversal period times out after 8 weeks, such as SEPA direct debit) is pretty much at the mercy of the airline voluntarily (or through legal action) returning the money. I've been waiting for 10 months for a similar reimbursement now...
When the country's second-largest airline went bankrupt in 2017, many banks refused to file chargebacks due to legal uncertainty around whether doing so might be considered unlawful interference with the bankruptcy proceedings. (The bankruptcy manager fueled these by actually sending out invoices supporting that claim.)
In the context of credit/most debit card paid tickets, this is largely a non-issue, since cancelled flights (in addition to merchant bankruptcy) are usually explicitly covered under the "service not provided" chargeback provisions of the schemes.
So, I might be wrong, but I don’t think there’s a single airline on earth that is consistently minting high profits—the most profitable airline (delta) earns 10% margins…in a good year.
Do we really need to make airline businesses even harder to run?
If passengers really saw value in the PAYF model, any airline with growth ambitions (eg. Ryanair) could take massive market share by implementing. The free market already solves this.
The fact that it’s uncommon tells me non-business travelers don’t see much value in it.
This is essentially how rental cars generally work in the US.
Both planes and hotels essentially almost always require credit cards. Hotels seem to have mostly liberalized cancelation policies--which had been starting to require more notice. And flights seem to be less likely to have fairly high e.g. $200 fees associated with changes.
Coincidentally, I'm finishing my second week as a consultant on a check-in modernization project for an airline. Most airlines are still using systems from 20+ years ago, and while they mostly work, they are EOL from the vendor.
Anyway, this change would throw a wrench in this project's plans, but at least they have something in progress that can track it. For airlines that haven't yet started or even planning to replace the old system, they are going to have to scramble.
Airlines already collect money when you check in in many cases: seat/class upgrades (both pushed by the airlines check-in process to up revenue) and extra bags, and a few other things. Moving the payment collection for the ticket itself to time-of-reservation to time-of-check-in would take work, but probably not totally upend the modernization plan.
Another stupid idea by politicians who try to fix the service they don't understand.
“The subsequent bureaucracy of cancelling ticket bookings and transferring the money back would be over with.”
Good one. I had a flight (DUS 2 MUC) cancelled yesterday (due to strikes).
Two clicks in the app, and the money was back in my account 20 minutes later.
This law will only do 2 things:
a) Increase prices for tickets
b) Will create a lot of friction. Just imaging you credit card being stolen/lost a day before the flight. Or you accidentally spending your credit on something else before the money is taken.
If you buy a cinema ticket for next weeks premiere, do you want to pay now, and have the ticket safe, or pay when you actually go to the cinema.
Probably you never fly budget airlines. Getting back your money is not two click and 20 minutes there. Also you could loose ticket (phone, paper) too, not only credit card. Actually you could drop your phone into the toilet at the airport or on the floor or run out of charge, etc, not like a credit card. Preauthorise/hold amount charged later is something there for long time already. I start to wonder who have no understanding here...
> If you buy a cinema ticket for next weeks premiere, do you want to pay now, and have the ticket safe, or pay when you actually go to the cinema.
But you can already reserve a seat at the cinema and if your local cinema happens to screw up on a frequent basis then you'd probably get a reservation instead of paying for the ticket beforehand.
MIT already has aircraft designs that use 50% less fuel per seat-mile. If more of the plane is empty there is higher incentive to reduce seat mile cost especially if average seat mile revenue is lower.
Can you show me a ref to this design? (And yes, I tried to find it myself.)
I suspect it doesn't actually work for the simple reason that fuel is the number 1 expense of airlines, and a 50% reduction would be utterly enormous for them - if such a thing existed it would be in extremely high demand.
Mind you that the company still receives the money regardless, the only change is that they have to enforce the contract (not the other way around). Here in Germany, you would probably mandate them to charge your bank account directly and that is almost, if not impossible to get out of.
A very possible outcome I see here is that you would probably be given a window in which to checkin, which will no longer hold until 2 hours before the flight, so they can sell the seats that were not claimed a second time
It‘s a stupid idea with all kinds of problems. What if, for some reason, your bank account is empty or your CC is over the limit at the time of departure. The transaction might fail and your flight will be canceled hours before departure. You won’t be able to book some other flight on such short notice, etc.pp..
There is a much easier fix. You give the airlines 2 weeks to refund the money. The have to refund it without any forms etc. because the damn well know who booked and paid a flight they canceled. Every day the overrun the 2 weeks, the refund is automatically increased by 5 percent. I have no doubt, 99% of refunds will be paid out after two weeks.
People seem to be focussing on the difficulty of dealing with reservations...
But I see this model may be intended to get rid of reservations and maybe schedules entirely.
If you see an advert that says "Fly to Berlin for €50.99", then you show up to the airport, see that there is a flight departing in 20 minutes, tap your card to pay the advertised price, and hop on the plane. If the plane is full, you wait for the next one in 2 hours.
Airlines by now have good models of passenger flow, by looking at national holidays, sports events, holiday seasons, etc, so they should be able to get most flights full but not overfull.
Basically the same pricing model as city busses. And it works fine there.
> Basically the same pricing model as city busses. And it works fine there.
If airlines had the same operational cost and complexity as city
buses.
And it doesn't work "fine" there: most city buses are empty for much of their route and have people standing in the aisles at popular times. This is tolerable for a bus company where operational costs are minimal and people are legally allowed to stand, but impossible for an airline.
I think the only way is a reliable third party (like the booking company) where the customer still owns the money but it is temporal locked for the airline till like flight + 1h or so.
Like the airline has a guarantee that the money shows up at the moment where it is needed and in doubt we could also have a system where the no-show fee can be "sub-locked".
The consumer on the other hand, never waives the money over until he is needed to (by confirming to the no-show or actually flying).
Similar systems exists for example for Visa guarantees. Interestingly, considering other success rates the airline should do they same for their punishment if they cancel ;)
This is basically already how online shopping with SEPA works in Germany. You place an order, type in billing data, they do a pre-authorization, and you get an instant "order confirmation". But the money is debited from your bank account only AFTER the vendor has sent out your parcel containing the goods.
Plus, Lufthansa, the main airline for business travel, has been offering exactly this PAYF model for more than a year now. So they are suggesting to enshrine in law what some companies already negotiated privately.
Sounds like a boon for airlines as they owe you nothing and have established no contractual obligation since they haven’t yet collected payment (consideration). Airlines are already regulated to reimburse passengers above and beyond for cancellations in Europe, this seems like a regulatory capture attempt to get out of the consequences of failing infrastructure.
what about when payment will be declined on check-in? will they allow flight and then demand payment or will they just don't allow to board? also what if check-in will be done online day before and flight will be canceled? I think that there is a lot of corner cases left uncovered and available for abuse
Would probably do what all other companies do: still provide the service and then based on the owed amount, they would send 3 warnings and then:
1. If the amount is small, just send them to Inkasso/Schufa, which will hinder their ability to close basically any other contract, from mobile phone to renting an apartment
2. Enforce collection through civil litigation via a lawyer firm
Presumably they would use a standard credit card hold - where the amount is verified and user has that amount reduced from their maximum limit and then the amount is only settled at check-in
If I were an airline I'd hook up a credit company middle man that pays the airline on reservation and owns the obligation. If the transaction on check-in doesn't work, then the customer owns the credit company money, not the airline who was already paid. This makes it exactly the same as buying the ticket with a credit card.
I'm wondering if it makes sense to split the difference by allowing airlines to block the amount on the passenger's credit card upon reservation, but only charge them upon check in. This way, the risk of non-payments or problems processing the payment on the check in counter would be minimized.
In Europe credit cards are less popular. Most people I know use debit cards with a special "virtual" debit card for Internet purchases. In this situation blocking a certain amount on your card is almost functionally equivalent to taking a payment in advance.
The customer has to transfer all the money to their "virtual" card account and the money is blocked.
The only time when blocking is better is when it comes to the refund, but that too can be botched by airlines by for example automatically completing the payment at a time of supposed check-in.
A much better way would be to pay an advance. Let's say 25%.
It's not even possible. Most card networks let pre-authorizations expire after 7 or 30 days [1], you'd need new laws for that.
Additionally, this will be a massive headache for business travelers that use their private credit cards - usually, you'd book a flight and file for reimbursement at the employer, which you then use to pay down the CC bill. Now when you book a larger amount of flights, suddenly you may end up with your CC running into its limit because all the flights are technically still "on hold" and can't be paid off.
I feel like it’s only about 15% of the time that a flight is canceled in advance of the 24hr check in window, most of the time it’s canceled after it’s scheduled departure time, so don’t really see any benefit here, if they only charged me once I arrived at my destination, that’s another story…
Pay to fly would create an incentive for airlines to overbook in each flight in order to ensure high utilisation in case of a no-show. Germany outperforms itself in idiotic ideas yet another time.
While this seems consumer friendly, I imagine that such a massive negative shift in the cash flow mechanics for airlines would result in them having to raise prices or degrade service.
Which airport are you flying out of where TSA takes five hours? I fly out of ATL - the worlds busiest airport - and it never took more than an hour. This was before I got TSA PreCheck last year.
The world is not only the USA.
There are other nations, some have a very big worker shortage.
(not comparable to the USA worker shortage - there are situations that are different from the situation in the USA)
This feels like a complex solution, compared to just making the airlines pay interest on top of the sum they owe to the consumer. That would make repayments quasi-instant
Why this wont work: must be done on EU level, not in tiny little Germany. This wont get momentum on EU level, hence, the (actually great) idea will die.
great idea or populism to mask the absolute failure in German politics in the past 20-30 years. If we didnt have the old industries (that the post-Nazi generation built), we would be doomed.
I almost broke my neck on that slippery slope there. Could you explain how that makes the ticket cancellable and most importantly how it would delay the boarding process since the money is taken at checkin? You would not be paying cash, most probably you would mandate the airline to retrieve the money from your account and they would do so upon checkin.
And if this is a "hemmed" industry, I would hate to see one that doesn't have these regulations. Also, the 400 euros you mention don't just come to your account if the plane is delayed, you have to fight months to years on them and the airline will fight you back citing obscure "out of their hands" circumstances. Usually you have to hire a firm that takes 30% of the amount because the process is hard to navigate.
I can show you on this doll where the hemmed industry touched me when RyanAir cancelled my flight and then refused to give the money back. Charge back was refused by the bank with a heartfelt letter saying that in this case I should wait for a refund because the times are hard for everybody. Then after 8 months they gave me my money back missing 60 euros, which the company pocketed.
Or see the current situation in which they cancel flights and then say: oh yeah, oopsie, we'll board on the next flight which is 3 days, see you then. And then you get stranded in Mallorca because there is no way for you to get back. But you'll get 600 euros for this in a year or 2.
Or see that company in Romania (also EU) that this year sold 178k tickets they never meant to honor. You would buy a ticket and then they would cancel the flight the next day - no fines here, they just have to give the money back but good luck with that. This measure would solve this problem.
I would add that Airlines have access to the same algorithms as the rest of us, and the boarding is a shit show because they absolutely don't care about making it better, it very often ends at the same time or earlier than fueling and baggage loading, so it's good enough.
I don’t think that this regulation would make any ticket cancelable. For one, the booking would still be an enforceable contract. But the airline would have to enforce it now. But a more likely scenario would be to hold the payment in escrow, release it on check in and refund it on cancellation. A bit like Paypal‘s buyer protection.
Uhm, those aren't affected. The airline would have the same duty to transport you as now under the same kind of contract, the only change proposed is to charge your credit card on the day you fly instead of the day you order. The rest of the contract remains unchanged.
Right now if your EU flight is cancelled you're entitled to a monetary compensation[1] on top getting your ticket money back. I worry that letting the airlines simply not charge you will allow them to wiggle out of this, or make the process to get it even more Byzantine than it already is.
[1] https://europa.eu/youreurope/citizens/travel/passenger-right...