After the Biden administration recently issued a final rule that would require airlines to automatically issue refunds to passengers whose flights are delayed or canceled, Ted Cruz and 3 other lawmakers introduced a bill that could undermine the entire effort.
The Biden administration recently announced their final rule requiring automatic refunds of airline tickets and ancillary service fees. There’s still some planning to get through before it would all go into effect, but eventually the rule would, “make it easy to get money back for cancelled or significantly changed flight, significantly delayed checked bags, and additional services not provided.” It would be easy because you wouldn’t have to ask for the money, or be pressured into getting a flight voucher instead of your money back. It would just happen automatically.
Unfortunately, sen. Ted Cruz (R-Texas), Sen. Maria Cantwell (D-Wash.), Rep. Sam Graves (R-Mo.), and Rep. Rick Larsen (D-Wash.) introduced new Federal Aviation Administration reauthorization legislation that would require passengers to send a “written or electronic request” in order to receive a full refund for a canceled or very delayed flight
The latest deal in Congress could mean that travelers are still bearing the burden of airlines’ mishaps.
Instead of automatically getting their money back, they would be forced to manually request refunds, wasting time and energy.
— Elizabeth Warren (@SenWarren) April 29, 2024
In other words, instead of making it easy for you, Cruz & Co. want you to have to still jump through hoops to get your money back. Because you know how easy airlines would make it for you to (A) find the right form and (B) get an airline to respond.
“I know there are concerns that some of the consumer-focused provisions, while well-intentioned, may have the opposite effect if not implemented carefully and considerately. We should give these provisions due consideration,” Cruz said, when consumer advocacy groups’ voiced concerns that his efforts could completely undermine the efforts to give passengers easy refunds.
Well, yeah – that’s why they’re still going to iron it all out before it would all go into effect.
Follow the money
It probably shouldn’t be surprising that all four Congresspeople have accepted substantial donations from the airline industry over the years (Cruz alone has reportedly received over $250k from the industry, over 10% of which came from Delta Air Lines alone, over the past 5 years). But since Cruz has shown the particular ability to make not only the American people (remember when Texas lost electricity and his response was to go to Cancun?) but his own peers intensely dislike him, it probably should be considered par for the course.
And since airlines spent a record $33 million on lobbying last year, mainly to fight these new refund rules, of course they’re going to ask their friends Cruz, Cantwell, Graves and Larsen to help their cause.
There’s still time to fix it
Hopefully, the bill will be amended, with adequate language reinforcing the need for automatic refunds, before the reauthorization act is finally passed. But if the proposed legislation remains as it is right now and somehow passes both the House and the Senate (not likely), President Biden would still have to sign it to become a law.
And that’s also highly unlikely.
Feature Image: Gage Skidmore // flickr // CC BY-SA 2.0
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5 comments
Cruz wants consumers to have the option to request a refund, and not make it automatic so that travelers don’t find themselves in a situation where the airline happily refunds their cancelled flight when it’s too expensive for them to actually get the passenger to their destination. In many or most circumstances where flights are cancelled at the last minute, same day alternative routings will cost much more than the original advance purchase ticket and merely getting a refund without the option of forcing the airline to get you to your destination would be a win for the airline and an out of pocket loss for the customer. Cruz’s provision gives customers the option of cancelling so that they can decide what is better for them in that moment, while Warren’s purported preferred position – I say purported because I doubt that she sincerely thinks that the alternative is superior – would often result in a windfall for the carrier.
(Comment edited by YMMV – paragraph that was against Rule #4 for approving comments was removed)
If Cruz is sponsoring legislation that is so consumer friendly for once, why not require the airline to contact the passenger and offer a choice?
This is not such an easy solution to cancellation/delay problems if you consider all the potential consequences. Until the change, airlines would typically place you on another flight. Under the new rule, airlines are required to automatically issue a refund if you do not accept alternate travel or a future credit. However, the new rule does not require that the airline actually offer you an alternative flight or future credit, even if another flight is available. So if it’s advantageous to the airline, they can simply cancel you now and give you an automatic refund (at your original price) and make you compete with all the other cancelled/delayed passengers to buy a new ticket at that day’s prices. Did you buy your ticket a while ago at a reduced fare when there were plenty of seats? Too bad—you now have to purchase a new ticket at today’s highest fare. On the return of a round-trip ticket? Too, bad—you now get a 50% refund but have to purchase a new one-way ticket which is quite often equal to 100% of the price of a round trip ticket. Purchased your ticket with miles before the latest devaluation? Too bad-you now have to purchase a new ticket at today’s price in miles—or pay in cash for a last-minute fare. I think it does make sense to give the consumer a choice in this situation between a guaranteed rebooking and a refund. But that choice is not mandated by the new rule. So this could end up being a windfall for the airlines and cause financial harm to consumers.
YMMV readers, read carefully what MAK wrote. Getting your $120.00 back in cash sounds great…Yea consumer!!..but when you find out your same journey later will cost $400.00, it is not good for the consumer. In the EU when you buy an airline or train ticket the carrier is REQUIRED to get you to where you contractually agreed. Even if they HAVE TO put you on another competing carrier. Why don’t we have those kinds of agreements, YMMV readers? Airlines would gladly give you the fare you paid after you searched diligently for that special price. When J.Biden used that word CASH….it incentivizes the crowd, Yeah, Yeah! But does not help consumers get the contract of carriage that agreed and paid for.
This is an election year and ALL politicians are stirring up the pot. And even some writers who have a bias one way or another.
Cruz and Cantwell (a Democratic party member and Senator) are right.
Automatic and easy refunds would strand a lot of passengers. When there’s a meltdown, everyone will be stranded and given there measly refund. You would then have to buy a $1000 ticket.
Make it easy to get a refund, yes. Make it easy to request it, yes. Automatically be dumped in the middle of nowhere, NO.