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The problem isn't overbooking. The problem is not auctioning the seats higher when overbooked. I've seen a number of overbooked southwest flights and people ca
by johngalt 9y ago
The problem isn't overbooking. The problem is not auctioning the seats higher when overbooked.
I've seen a number of overbooked southwest flights and people can't line up fast enough for a $300 flight credit + next available flight. I can't imagine it ever going over $1k.
IMHO if any airline should continue overbooking it's SWA. No first class, no assigned seats. Most of the flights are short range with multiple flights options every day. You're much more likely to agree to switch to the next flight if it means only waiting 2hrs.
- lisper 9y ago> The problem isn't overbooking. The problem is not auctioning the seats higher when overbooked. This. Oh so very much this. United could have avoided this whole debacle simply by not imposing price controls on the market for seats when it became a buyer rather than a seller.
- rm_-rf_slash 9y agoAnd they could have offered the passenger free United flights for life and it still would have cost less than this embarrassing and protracted PR catastrophe ever will.
- PhantomGremlin 9y agoAs someone on pprune.org said: Announcer on local TV said it would be less damaging if United actually crashed the plane !
- desdiv 9y agoBlack Mirror episode: PR disaster happens at 40,000 feet and gets recorded by smartphones. Since they're still in the air the footage hasn't been uploaded to the internet yet. The on-board AI supercomputer makes the determination that the negativity of a plane crash would be less than if the footage leaks out so it decides to crash itself in order to maximize profits.
- HarryHirsch 9y agoCould they have averted disaster with money? It's astounding that there were no volunteers when they offered USD 800 for a seat, 800 dollars is a nice sum. Every single passenger on that airplane thought there was a catch involved, they were getting again 800 dollars in airline vouchers, which everyone knows have big gotchas attached. The airline has a trust problem, which won't improve anytime soon.
- ghaff 9y agoMy understanding is that the next flight was something like the following afternoon. Business travelers are basically not going to voluntarily take a later flight at all. With respect to vouchers, most people don't travel all that much so a 1 yr. voucher isn't worth much. But offer cash (or a voucher at 2x) and you'll get people at some point.
- bmohlenhoff 9y ago> Business travelers are basically not going to voluntarily take a later flight at all. This. As a business traveler, I don't know how I would justify this to my finance department and/or management. It would take too much effort to justify the change in travel plans for a shitty voucher that I'd probably never be able to redeem.
- eh78ssxv2f 9y agoI once received the $500 voucher, and as an infrequent traveller, it was completely useless. The voucher went unused and expired. I wish they had offered me cash. Now, I am a frequent traveller and mostly travel on business. Now again, the vouchers are useless to me. I think the airlines should offer real cash instead of vouchers. More people would be ready to take those instead of vouchers.
- snuxoll 9y agoYou're lucky you got a single $500 voucher, they like to multiple smaller ones that you'll likely never use up.
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- lutorm 9y agoWell in this case the market is distorted by the fact that regulations allow the airline to not let people board for a much smaller cost. If the airline didn't have that legal out, they would be forced to negotiate terms with each passenger whose contract they wanted to break.
- douche 9y agoThey didn't even hit that limit before they sent in the goons in this case, though.
- lutorm 9y agoThe actual limit is 4x the price of the ticket, capped at $1350, so it could very well have been down in the $400 range.
- onli 9y agoThere is no limit. It is a minimum, and it does not work like you seem to think it does (if you blame regulations, which is how I read that comment). See https://www.usatoday.com/story/travel/flights/todayinthesky/2017/04/10/what-rights-do-overbooked-fliers-have-not-many/100287338/ https://www.usatoday.com/story/travel/flights/todayinthesky/...: > For example, an involuntarily bumped traveler who arrives to his final destination more than two hours late (fours internationally) is entitled to an amount worth 400% of his one-way fare (capped at a maximum of $1,350). There are no regulations forbidding United to offer more when a passenger is already seated, and that passenger thus can't be legally bumped (apart from because of safety reasons maybe).
- lutorm 9y agoI am well aware of how it works. What I said is that the incentives to offer more than what they are legally required to offer by the IDB regulations (which does have an upper limit) are significantly lessened since the IDB rules give them a "get out of contract free" card for that amount.
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- zeroer 9y agoYea, I agree the problem is not auctioning seats high enough. But the proximate issue is that United didn't offer cash, but $800 in United Fun Bux that are worthless for most people. The vouchers they were offering were only valid at dates United decided. The vouchers expired after a year. And they are offered in coupons for which you can only use one coupon per flight, and the excess value is lost. Practically all news outlets are reporting that "United offered $800 in compensation", but the reality is that it's closer to $0 in compensation. It's disingenuous to call it "compensation". A better move on the airline's part would be to offer some amount of airline credit, and then half that in cold, hard cash, at least up to $2,700 credit / $1,350 cash, which is what they have to give you for an involuntary bump.
- mikeash 9y agoYes, the voucher thing is nonsense. I've been on overbooked flights before where I could have easily taken the next flight instead. I never volunteer, because the vouchers are worthless to me. Offer me cash and I'll often be first in line.
- kalleboo 9y agoThe only time I've volunteered to be bumped was when BA offered $700 in cash (technically I got a prepaid VISA card) and a free hotel+meals. That may be due to the EU though (there are passenger rights regulations about compensation for delays caused by the airline)
- ganley 9y agoBack in the days when I traveled a lot, I would ask for some sort of on-the-spot compensation - usually, put me in first/business class on the rebooked flight. Sometimes it worked, sometimes not.
- iLoch 9y agoYou can ask them to pay you in cash as long as you don't accept the offer before hand. They're legally required to compensate you with cash if you ask.
- neurotech1 9y agoOne possibility is that the regional flights are only marginally profitable for United, and very slim margin for the regional carrier (Republic Airline/United Express) so they limit voucher amounts for bumped passengers. For an Embraer 170 aircraft (70 seats) the operating cost of the flight is about $2500-$3000 for the Chicago to Louisville flight. A supplementary flight with the 4 crew and any re-booked passengers would have cost the airline about $5,000 if they flew out-and-back as a non-scheduled flight. SWA 737s cost around $4,000/Hr to fly, but a non-scheduled (Out and back) flight on a shorter route would still cost less than $12,000 in operating expenses. The $1000+ flight credits for bumped passengers add up fast, but supplementary flights are relatively rare for airlines, other than for cancellations due to maintenance issues. CEOs like Oscar Munoz need to make supplementary flights easier to authorize, and the negative PR would be significantly reduced.
- mikeash 9y agoThey could have just used a rental car or a taxi. Airline crews don't have to travel by air. The amount of inflexibility displayed by United is breathtaking.
- thunderstrike 9y agoDo you understand how expensive it is to take a taxi that far? Or the fact that taxi/rental car companies usually don't like you going over state lines?
- dhfhduk 9y agoSo... my first reaction to your comment was "why don't they just turn this into an actual auction, with no price limits? This seems like such a good solution that I feel like I must be missing something." However, thinking about it more, I think there's a problem with that that's hidden by the nature of the United debacle. In that situation, the passengers had tickets, and they company was trying to seat their own staff. That is, the potential buyer was the airline, and the sellers were the passengers. So in that scenario, auctioning makes sense, because you can literally flip the buyer and seller roles. However, in a typical overbooking situation, there are more passengers than seats, so it's unclear who the buyer and sellers are, because none of the "sellers" actually "own" anything definitive. If the tickets are all infinitely valuable to each passenger, no one can get on the plane, and there's a sort of stalemate. Then I suppose there would be a cost to each passenger, and an incentive to accept a price, and it wouldn't be infinite anymore. But in general, the cost dynamics seem weird to me. But then again, I'm not an expert in this. At some level, overbooking seems indistinguishable from fraud--which can also be profitable for its practitioners.
- jackvalentine 9y ago> However, in a typical overbooking situation, there are more passengers than seats, so it's unclear who the buyer and sellers are, because none of the "sellers" actually "own" anything definitive. I'm not quite sure I'm following. When the airline overbooks then tries to pay off passengers to accept a different flight the buyer is always the airline. They're buying your seat back from you to satisfy their contract with someone else. I can't fathom a situation where every seat is infinitely valuable - out of several hundred people surely at least one person will accept a million dollars for example. Overbooking can look like fraud, but if the airline offers an uncapped ever-increasing payout for a seat then the risk profile increases significantly for them and they'll do it to a lesser degree.
- mikeash 9y agoI'd be utterly shocked if it ever required more than, say, $2,000 to buy enough seats. The trick, of course, is that it has to be actual United States Dollars, not this worthless fun money voucher stuff they usually offer.
- sandworm101 9y agoIt isn't a simple auction. Not all passengers are equal. There are issues that make an airline not want to bump some passengers. For instance, on some international flights there are rules against unaccompanied baggage. So the passenger without checked luggage will be bumped in order to save time. Passengers travelling in groups are also preferable as they will more likely share a hotel room. That's why families get bumped so easily. And then there are connections. The passenger who will miss subsequent connections is an expensive person to bump. This seems to have been the case in the United fiasco. The man was travelling in a group (his wife was with him) and didn't have any checked luggage, else we would have heard about it being offloaded or returned to him in hospital, and had no connections to make. Such complications go beyond the simple cash payout, making a strait auction difficult. Want never to be bumped? Travel alone but with a pet in the hold. They won't touch you. Or travel with someone in a wheelchair. They are also an expensive awkward person to bump. As I said to one gate person: "We cannot be bumped. My grandmother only has pills for the next 12 hours." That lit a fire under them. Grandma knew to play ball and suddenly looked very much older than she was.
- dopu 9y agoThe problem is overbooking, though. Corporations are getting preferential treatment by being allowed to sell services which they're not going to fulfill. The boner people on HN have for objectivism really does get quite old.
- tomerico 9y agoOverbooking makes air travel more effective than, with less empty seats and less pollution per passenger. The way it eas handled can definitely be improved, but you can't argue that it is inherently bad.
- stephenr 9y ago> Overbooking makes air travel more effective than, with less empty seats and less pollution per passenger > but you can't argue that it is inherently bad. You're simplifying things a bit too much. You can't go from: - We want to make air travel more cost effective, and less damaging to the environment. And arrive at: - The only way to achieve this, is to sell more tickets than we have physical seats for, to ensure the plane is jam packed when it takes off. There are always alternatives, Americans just seem to be fucking brilliant at ignoring any possible alternative than their first shitty attempt.
- ouid 9y agoit uses less fuel per passenger to ensure that every flight is jam packed. It's more efficient and everybody wins. There are almost no examples of situations that overbooking + auctions doesn't solve. I think you don't understand the law as it currently exists, because what happened on that united flight was in clear violation of that law. They didn't deny the man boarding, they deplaned him. This isn't something the airline is allowed to do for economic reasons, ever.
- yazan94 9y agoCan you explain what you mean by the overbooking + auction system? I don't fly often and though the news has left a bitter taste in my mouth about United, I do want to understand how their system works and their flaws in a less biased way.
- deleted 9y ago[deleted]
- flukus 9y agoShould I be able to sell you a car, have you pay for a car, have you come to collect the car and then tell you there's no car?
- rangibaby 9y agoIn this case, you're in the car, ready to go. Wait! I need that car so my brother can drop his kids off at their grandparents house a state over. You don't want to give it back? Tough, the police are on my side. Thanks for your understanding. Here's an $800 voucher for the next time you buy a car off me.
- wccrawford 9y ago"This case" was an unusual incident. The majority of overbooking is handled before anyone enters the plane. So while your analogy works for the doctor who was dragged off the plane, it doesn't work for the overbooking system in the air travel industry as a whole.
- flukus 9y agoHail Corporate!
- nommm-nommm 9y agoThere was a Seinfeld episode about this. https://www.youtube.com/watch?v=4T2GmGSNvaM https://www.youtube.com/watch?v=4T2GmGSNvaM
- sytelus 9y agoAnother solution is even more simpler. After all seats gets booked, they should clearly mark overbooked tickets as "probable" tickets and heavily discount it + refund it if not eventually available. Keep in mind that airlines don't make huge profits per flight. Giving away $10K to 4 passengers is like giving away 80 seats or about 10 to 20% of revenue which could be almost all of their profits for that flight.
- cbcoutinho 9y agoThose airlines take a risk by overbooking, and that risk can be penalized by a net negative profit if need be. If you're allowed to gamble, you need to be able to lose.
- awinder 9y agoYup, and moreover like any good casino it's pretty clear that they did the math already. That's why you're getting $800 fake bucks: they crunch figures on how much of that $800 they'd be on the hook for. If they gave you cash, I bet the inflection point where this entire overbooking scheme is actually fiscally worth it, becomes a losing proposal.
- farm_code 9y agoThis is how they do in Indian railways. We book tickets. If it's full, we get waiting list number which will be confirmed a day before or on traveling day. If not confirmed, it will be cancelled automatically and refund sent to your account.
- GordonS 9y agoI've seen this happen many a time with British Airways in the UK too - they just keep offering more money until someone volunteers to move to a later flight. Seems like a good way to manage overbooking, and I've never seen it not work.
- dx034 9y agoThe difference is that in the UK, you'll either have multiple flights a day or can take train/car without much delay instead. That's very different in more sparsely populated countries as the US. But cash is likely to be the main issue here. If united had offered $800 cash, they would've probably found someone to rent a car and drive down there instead of flying.
- GordonS 9y agoOften this is true, yes. But I've also seen this happen with flights within Europe on occasion too - the bidding usually starts with £100-£200 cash plus a night in a good hotel with transfers dinner paid for, and a flight the next day. I don't think I've ever heard the auction go very much past that. I guess there is always someone not in a hurry willing to extend their trip by 1 day. Actually, I think I considered it myself one time, but someone else took the deal while I was still thinking on it! Compensation is definitely the main issue. If United had offered a decent sum of cash (I mean cash, absolutely not United vouchers) they would certainly find someone willing.
- pif 9y agoThe problem is overbooking. When it will be definitely banned by law, flying experience will get better. Want to pay less? No refund on no-show. Prefer flexibility? Pay something more. But, once you get top the airport, you know you'll be on the plane.
- corobo 9y agoDo people really miss their flights so often that overbooking isn't often an issue or do a lot of flights have people that need to wait for the next one? As someone that's never flown it's surprising to me that overbooking is even a thing airlines do, who's out there missing their flights? I can't even imagine cancelling a pre-booked taxi never mind a flight!
- viraptor 9y agoThere can be a number of reasons for missing a flight. Two examples: a) You're going from an airport which you need 2h+ to get to, and your train is delayed. b) You're on a week long holiday going through multiple towns, you miscalculate travel time / miss a transport, and don't arrive on time.
- Ajedi32 9y ago> Do people really miss their flights so often that overbooking isn't often an issue Yes. Wendover Productions on YouTube posted an excellent video a while back explaining why airlines overbook their flights: https://www.youtube.com/watch?v=EqWksuyry5w https://www.youtube.com/watch?v=EqWksuyry5w Most of the time it's not an issue.
- nommm-nommm 9y agoUm... yes. I missed a flight due to major flooding on the route to the airport requiring me to take the loooooooooog way around. The flooding didn't effect the airport itself (or my flight) because I don't live in a town with an airport. It's also very, very easy to miss a connector flight if the plane coming in is delayed, or even if the airline decides to route you through an entirely different city. I've missed a couple that way. You can get held up at customs or security when landing in a new country and that country requires everyone to go through customs and security again. Then there is illness, accidents, and emergencies that come up all the time.
- ghaff 9y agoYes. Mostly because of delays that cause them to miss a flight that they're connecting with. You also have people oversleeping, getting caught in traffic, getting confused about their flight time. It happens. I've missed a few flights in my life for these reasons. (But just a few.) Finally, business travelers do make last minute cancelations and changes on a pretty regular basis--for example, to get on an earlier flight out.