Air Transport Association of America, Inc. - Petition for Rulemaking

Comments of the Air Transport Association of America

Filed on regulations.gov — full text not in the inline record.

Filed on regulations.gov — full text not in the inline record.

Gentlemen: I understand that the Department of Transportation is taking comments on a proposal to increase the penalties on airlines for overbooking. I have the following comments for your consideration: 1.Many of the problems encountered by our airlines today are due to lack of competence on the part of management. The DOT cannot fix or regulate away this situation. 2.Overbooking is an attempt to maximize profit. You can not fault the airlines for seeking profit. 3.The best way to solve the overbooking problem is to present a penalty which even incompetent management is capable of comprehending. They have to be able to evaluate the risk of overbooking versus the profit of overbooking. Todays penalty is not sufficient to make them take it into consideration. 4.I suggest that you make it a real penalty. The penalty should be double the cost of the ticket for the overbooked flight. You will then have the attention of management of the airlines.

The problem of involuntary denial of boarding is related to business passengers double-booking and airlines need to acomodate the business travelers quickly changing needs. Overbooking is usually an efficient method to make sure that more passengers are allowed to fly, even if a plane shows that all seats were sold. The solution lies in increasing the cost to the airline to involuntarily deny boarding to seek the tipping point where economic realities force the airline to overbook conservatively. Using CPI or Airfare trends to set the increase in penalty is not the solution - set an arbitrary increase and see if it results in reduced patterns. If not, set it higher. Find the economic equilibrium where it hurts airlines enough so that they will adjust their algorithms, but not so much that they cease this very useful tool to serve as many passengers as possible.