Airline raises give-up-seat cash
It pledges to cut back on overbookings, make other changes
DALLAS — United Airlines says it will raise the limit — to $10,000 — on payments to customers who give up seats on oversold flights and will increase training for employees as it deals with fallout from the video of a passenger being dragged from his seat.
United is also vowing to reduce, but not eliminate, overbooking — the selling of more tickets than there are seats on the plane.
The airline made the promises Thursday as it released a report detailing mistakes that led to the April 9 incident on a United Express plane in Chicago.
United isn’t saying whether ticket sales have dropped since the removal of a 69-year-old passenger by three airport security officers, but the airline’s chief executive officer admits it could be damaging.
“I breached public trust with this event and how we responded,” Oscar Munoz told The Associated Press. “People are upset, and I suspect that there are a lot of people potentially thinking of not flying us.”
To head off customers leaving, United had already announced that it will no longer call police to remove passengers from overbooked flights and will require airline crews traveling for work to check in sooner. On Thursday, it added several other new policies including:
Raising the limit on compensation starting today to $10,000 for customers who give up their seats. That is a maximum — it’s unclear how many, if any, passengers would see that much. The current limit is $1,350. Delta Air Lines earlier this month raised its limit to $9,950.
Sending displaced passengers or crew members to nearby airports, putting
them on other airlines or arranging for car transportation to get them to their destinations.
Giving gate agents annual refresher training in dealing with oversold flights. Munoz said he also wants agents and flight attendants to get more help at de-escalating tense situations.
While not a factor in this month’s incident, United also said that starting in June it will pay customers $1,500 with no questions asked if the airline loses their bags.
For United, the timing of the ejected-passenger viral video could hardly have been worse. The airline struggled after a 2010 merger with Continental, enduring several technology breakdowns that angered customers. In the past year, however, the airline has flown more ontime flights and lost fewer bags.
It recently rolled out plans for expanding service this summer.
Instead of being commended for those signs of progress, however, it has faced more than two weeks of withering criticism and mockery. David Dao, the passenger injured when he was yanked from his seat, reached a settlement with the airline Thursday.
Dao’s settlement terms with United are confidential, according to a news release issued Thursday, by the Corboy & Demetrio law firm which represents him.
Munoz apologized again and faulted his own initial response, in which he defended airline employees and called Dao belligerent.
“That first response was insensitive beyond belief,” Munoz said. “It did not represent how I felt,” saying that he got “caught up in facts and circumstances” that weren’t initially clear, instead of expressing his shock.
On Thursday, Thomas Demetrio, Dao’s attorney, said in a statement that the policy changes “are passenger friendly and are simple, common-sense decisions on United’s part to help minimize the stress involved in the flying experience.
“Both Dr. Dao and I applaud United for promptly addressing the many issues that have plagued passenger satisfaction in the arena of airline customer service,” Demetrio said.
He has said Dao suffered a concussion, a broken nose and two lost teeth in the incident.
In Thursday’s report, United provided new details about the incident. It said Flight 3411 to Louisville, Ky., was oversold by one ticket, but a volunteer gave up his seat. After passengers boarded, four crew members of Republic Airline, which operates many United Express flights, showed up late after their Louisville-bound plane was delayed by a mechanical problem.
United said it was a mistake to let the Republic crew board late, which required removing four paying passengers; calling officers
when there was no safety or security issue; and not offering enough money to entice volunteers to give up their seats.
“We could have spent a lot of $10,000s and made that thing right,” Munoz said.
United said it will reduce overbooking, particularly on flights with a poor track record of finding volunteers to give up their seats, but won’t end the practice. Munoz said if airlines can’t overbook there will be more empty seats and fares will rise. Delta CEO Ed Bastian called overselling flights “a valid business process.”
Politicians in Washington and elsewhere have called for a ban on overselling flights. Some critics have said airlines should leave a few seats empty if they think they will be needed by crew members.
Southwest Airlines said Thursday that it would stop overbooking flights, tentatively ending the practice May 8.
Southwest’s move underscored the urgency among carriers to avoid a similar United Airlines debacle. Delta Air Lines Inc. increased payouts to almost $10,000 for passengers who voluntarily give up their places on oversold flights.
“It’s not a topic that is brand new to us,” Southwest Chief Executive Officer Gary Kelly said during a conference call to discuss earnings. “That’s one of the pain points we’d like to eliminate.” He said the airline has been reviewing overbooking policies for a couple of years and
indicated that the United incident added urgency.
“It puts the question under a bright light. Why not do it now?” Kelly said.