There have been various reports of incidents involving passengers that can’t travel due to overbooking. Despite the stress caused, these situations don’t happen by accident, they are circumstances of deliberate airline planning.
Carriers have been overbooking their flights for decades as a way to maximize income. According to Tech Crunch, on average, five percent of travelers miss their flight. Furthermore, there are some situations where 15 percent of passengers do not show up. Rather than accepting that there will be empty seats regularly on their flights, airlines want to further monetize them.
In fact, the price of a plane ticket is determined by the costs that are recovered by overbooking. The Independent reports that in 2016, nearly three million easyJet customers missed their flights. This meant that the airline was left with empty seats. Events such as these increase the carrier’s costs, which could mean an increased ticket fare.
If an aircraft has the capacity to fly 400 passengers and five percent do not show, 380 are onboard. Therefore, 20 seats are available, which is 20 further ticket sales an airline can make. Some of these ticket sales can be worth thousands of dollars, depending on the seat. It is more effective for carriers to account for these extra 20 seats beforehand rather than scrambling to make a sale on the day.
Every little bit helps
When the flight ends up having more passengers checking in than seats available, airlines ask for volunteers to switch their flight. These volunteers are often compensated with money and even a hotel reservation. However, it is more cost-effective to compensate a few customers than to take off with empty seats. Along with this, there is slightly less environmental impact per person, as each plane is as full as it can be.
If a traveler is denied boarding, or in some cases taken off the plane, due to overbooking, there are certain rights that they are entitled to. These rights differ per region, but generally, rerouting and monetary compensation is a standard.
Under EU Regulation 261/2004, passengers that are involuntarily denied boarding on an overbooked flight departing from an EU airport are eligible for compensation. Also, those who are overbooked on flights inbound to the EU operated by an EU airline are also eligible under the legislation.
Airlines try to control overbooking issues by analyzing events and passenger behavior. Whenever there is a huge event in a certain area such as a festival in New York on a certain weekend, the airline knows not to oversell their tickets. This is because they know that the majority of these customers are intently traveling that weekend. Therefore, passengers have less incentive to miss their flight.
Additionally, carriers are increasingly using data and technology to determine how to best plan their ticket sales. Air France recently launched a program called SWING to help them manage situations such as this. The software sends an email to select passengers on Air France flights, offering alternative flights plus credit.
With reports of controversial incidents occurring due to overbooking, airlines now have more incentive to better control their overbooking strategies. Have you been in an unfortunate incident related to overbooking? Share your experience with us in the comment section.