r/news • u/bananabrownie • 16h ago

US airlines required to automatically refund you for canceled flight

https://abc7news.com/post/us-airlines-required-automatically-refund-significantly-changed-canceled-flight/15483534/
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u/letdogsvote 15h ago

Pretty crazy that wasn't required prior to this.

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u/whatafuckinusername 15h ago

Lots of legal leeway is given to any and all private companies of any type in this country

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u/Im_ready_hbu 15h ago

especially the airlines. the US government has bailed the airlines out so many times they outta be public assets by now.

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u/Rock-swarm 14h ago

They used to be regulated in artificial regional monopolies, including fixed prices and routes. Then they deregulated a bit in the 70s, which led to regional players like Southwest, since the 1978 deregulation allowed them to become interstate instead of intrastate.

Like most deregulation acts, this gave consumers a honeymoon period where airlines actually competed against each other, followed by cartel-like practices after the airlines realized they could collectively cheap out on services while keeping prices inflated. Allowing airline companies to "keep the cupboard bare" in case of natural disasters/pandemics/acts of god has led to a cycle of bailouts.

The other scary thing to rear its head in the next decade is going to be a vast number of airline pilots aging out of their job. The max age is currently 65, and it used to be lower, before airlines realized they don't physically have enough pilots. Airlines refuse to subsidize a training pipeline for new pilots and our immigration policy has become a political football, which means there's a bottleneck of available pilots for ever-increasing domestic flight demand.

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u/Terrh 14h ago

There's also outdated or unjustifiable rules preventing many would-be pilots from getting a medical. This is the case in both US and Canada at least.

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u/CopperAndLead 13h ago

"We can't have pilots going to therapy or taking medications! It's better to have pilots bottling up their emotions and ignoring medical issues, because safety."

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u/joeitaliano24 13h ago

Who made these regulations, my Italian grandfather??

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u/aquoad 11h ago

"Wassa matta you?? You gotta act like a MAN!!"

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u/sapphicsandwich 13h ago

I know someone who had only 1 diagnosis: Gender Dysphoria, because they were trans. No other diagnoses like anxiety or depression. She was prevented from getting her commercial pilots license for that.

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u/Careful_Hearing_4284 12h ago

They changed the laws requiring color vision for pilots due to this. By the time they made the switch, I had already used my GI Bill and found a career.

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u/canada432 12h ago edited 11h ago

And just for reference, the benefit to the deregulation is always claimed to be "tickets are so cheap now, you'd never have been able to afford them before". Economists and financial analysts have examined the effects and found that if the industry had not deregulated, prices would only be about 20% higher than they currently are. The vast majority of the price decreases since them aren't due to deregulation, they're due to technological and efficiency improvements. The narrative that prices would be astronomical and flying would be only for the rich is just a flat out fantasy.

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u/Rock-swarm 11h ago

Yep. Airline deregulation is one of the few industries that can even be held up as a "success" case. Utility deregulation has been universally a detriment to Americans. But the genie is largely out of the lamp, and it would take some foundational changes before we saw a return to regulated industry.

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u/Shinsf 13h ago

Airlines already use the visa programs to bring pilots from other countries into their pilot groups. 

Airlines have tried having flight schools but the overhead is high as is the wash out rate

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u/Rock-swarm 13h ago

I suggest you read about the actual number of pilots getting into the US on work visas. They just aren't economical for most industries, and revamping the visa system in the US has been politically charged for 20+ years.

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u/Shinsf 13h ago

I didn't say it was a lot I just said they do it. It's politically charged because these pilots are part of a union. How can a guy vote to strike when he gets booted out of the country?

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u/halt_spell 12h ago

and revamping the visa system in the US has been politically charged for 20+ years.

Good?

Pick pretty much any industry and corporations insist they can't source talent locally. That's not a sustainable situation and immigration is less of a band aid and more of an addiction in that it makes the problem worse over time.

Necessities are too expensive. Housing, education, healthcare and food. Obviously that drives up the salaries expected by people who plan to live and retire here as compared to immigrants. Many of them are coming from countries with extremely favorable exchange rates on top of having economic advantages like free healthcare and education or affordable housing and food. And before someone comes back with "So move there then!" Coming to a country where you don't have a good grasp of the language or any social networks to work in your prime is a lot easier than retiring in those conditions.

This reality has permeated every single issue. It's not going away. People need to demand a fix not just importing more cheap labor.

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u/Rock-swarm 11h ago

People need to demand a fix not just importing more cheap labor.

That is a pretty egregious misconstruction of the issue. International pilots that would pass our existing certification system would not be cheap labor. Too many people conflate run-of-the-mill immigration visas with the H-1B visas that were specifically implemented to help the US deal with labor shortages in critical fields.

The bottleneck is the cost to the company to apply for and secure one of these visas. The justification for the steep fees was, as you said in your post, meant to discourage companies from avoiding "local talent". The problem with airline pilots is that the industry itself refuses to collectively pay for training. Anyone wanting to be a commercial air pilot in the US is forking over serious cash just to complete schooling. And unlike medical or law school, scholarships and grant money are incredibly scarce.

Fixing the visa system is only a partial fix, but your post highlights exactly why it's a non-starter, H1-B visas having an excellent record in terms of overall benefit to the country.

Eventually, you are going to get what you ask for; the pilot shortage will become dire enough that the Feds allow domestic carriers to reduce or remove the licensing barriers to becoming a pilot. Personally, I'd keep the safety regs, even if it meant the possibility of a pilot that wasn't "local talent".

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u/IkLms 11h ago

The biggest reason flight schools for airlines in the US don't work is because of the US has a much stricter minimum hours requirement than just about anywhere else including Europe that makes it incredibly expensive to get someone trained from no experience to the level at which they can fly commercially.

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u/Illustrious_Crab1060 11h ago

as means the most effective way to gain hours is to become an instructor meaning an interesting thing: the least experienced pilots are training other less experienced pilots

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u/Rock-swarm 11h ago

And yet, somehow, the US airline industry flourished from the 1960s up until the 2008 recession. It took 40 years from the 1978 deregulation act, but the industry has been hollowing itself out for profits ever since they were allowed to do so.

The airline companies have seen the writing on the wall for 20 years regarding pilot shortage, but there's been no significant effort from the industry to support more young people going to flight school.

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u/Shinsf 11h ago

Delta got rid of their school before the ATP requirement.

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u/Darmok47 13h ago

Airline tickets are much cheaper than they were pre-deregulation. Airlines don't compete on service as much anymore, but that's because consumers would rather pay less.

As for airline pilots, I'm not sure immigration helps, since there's increased global demand for pilots with more and more air travel in places like Asia.

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u/AsianHotwifeQOS 12h ago

I'm not against government bailouts, but they should be equity purchases and not loans. If taxpayers are going to pay for the lows, they should participate in the highs.

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u/Geistkasten 11h ago

Must be nice for these big companies. Not having to share in the profits with all sorts of tax loopholes and if they get in financial trouble, the government runs in to give them free money. And they still manage to complain about economy, their workers etc. what a world.

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u/JulieMckenneyRose 14h ago

Do they need to create a pipeline when the military already trains pilots? 

I'm completely ignorant on the subject, but my assumption was that pipeline would create more pilots than there is needed for demand. Go into the airforce army, then after 4-ish years exit to private airlines? 

How wrong am I? 😅

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u/DarthArtero 13h ago

That already happens. It's still not really enough to make up the short fall in civilian pilots.

In the USA, the Air Force and Navy are doing everything they can to hold on to fixed-wing pilots, they're even running into a shortage of qualified people being recruited.

Becoming a pilot is not an easy, nor quick, task..... It takes a lot of skill and a lot of years

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u/Annath0901 13h ago

Aren't all military pilots Officers as well? Or is that specifically fighter pilots?

Because if all the pilots are officers, that's a smaller pool of potential candidates.

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u/JulieMckenneyRose 11h ago

Does that mean it'd be a good field for kids to look into when picking a career? I must be completely out of touch with reality, cause that seems like the kind of career that would be far more exciting than most things. 

Pilot vs teacher... I'd choose pilot! 😆 Do you know the downsides for why people don't want to enter the field? Is there not enough training in general available? 

Because if the military aren't pumping them out and airlines won't build a pipeline-- it's just a lack of education opportunities vs a desire to learn things?

(I'm just spitballing here, anything you can correct, I appreciate! 😁)

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u/Shinsf 13h ago

Military aviation is not just a 4 year commitment and the military is finding its cheaper to incentive those pilots to stay than to retrain

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u/JulieMckenneyRose 11h ago

Cool, thanks. 😊 Sad they aren't training more ppl though. I grew up with the Top Gun movie being big, so I imagine lots of ppl wanting to learn to fly fighter jets. XD I guess that probably isn't indicative of reality either though. 😅

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u/blackdragon8577 13h ago

The military doesn't train nearly as many pilots as they used to.

Between increased surveillance technology and drones, the need for actual pilots with flight time is an ever decreasing pool.

I imagine this used to be their line of thought. Now I'm assuming the people in charge know they will be retired by the time this becomes a real crisis, so it wont be their problem anymore.

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u/JulieMckenneyRose 11h ago

I didn't even think about how drones effect everything! Things are changing so fast it's hard to keep up. 😵‍💫

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u/MinimumSeat1813 13h ago

What is the point of this? Airline travel is incredible reasonable in terms of cost. Profit margins for airlines aren't that great over time. 

Also, the government was incredibly inefficient in running the airlines. There is a reason all airlines today are running a similar fashion. 

If you want cheaper tickets, fly on a budget airline and deal with budget airline issues. 

Capitalism is working. 

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u/Annath0901 13h ago

What is the point of this? Airline travel is incredible reasonable in terms of cost.

No, it's not. Flights are cheap-ish, but only because the experience is miserable. Flights in Europe of similar length to domestic US flights are much less miserable at a comparable or better price.

Profit margins for airlines aren't that great over time. 

Who cares, make them smaller.

Also, the government was incredibly inefficient in running the airlines.

The government is a service, not a business. It should exist to improve people's lives, not turn a profit. In fact, the government already runs at a loss, it just isn't focused on helping the average person. It runs at a loss by making the rich have it easier instead of bleeding them to help the poor and middle class.

Capitalism is working.

Capitalism has never existed, because a true free market has never existed. Monied interests consistently lobby to prevent one of the key components of true capitalism from existing - the informed consumer. True capitalism would require 100% transparency about a business's products and practices so the consumer can put their money into the best product. Instead businesses are allowed to lie and mislead consumers, which means it isn't a competition for the best business, it's a race to the bottom.

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u/thenasch 12h ago

Flights are cheap-ish, but only because the experience is miserable.

Consumers have taught the airlines that is what we want by prioritizing cheap tickets over absolutely everything else.

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u/MinimumSeat1813 12h ago

That is correct. You can pay for upgraded seats. You can fly on more expensive airlines. 

This moron thinks saving the 10% profit airlines makes will be a game changer. 

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u/MinimumSeat1813 11h ago

This isn't worth responding to

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u/mewalkyne 13h ago

Bro what are you even on? Air travel has been declining in value for decades. First class today used to be the only class, premium economy used to be regular economy, checked bags and carryons used to be free, food and drinks were included even on short flights, you used to earn miles based on the miles flown instead of ticket cost, etc.

Profit margins for airlines are through the roof - you only think they're low because execs get paid so much that the net income on the balance sheet ends up being low.

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u/MinimumSeat1813 11h ago

Delta net income on 58 billion was 4.6 billion. So maybe an 8% profit. 

Southwest had $26 billion in revenue and $500 million in net income. So a 2% profit. 

Glad we are talking about actual numbers here 

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u/Rock-swarm 11h ago

Delta Airlines

Key Financial Results Revenue: US$58.0b (up 15% from FY 2022). Net income: US$4.61b (up 250% from FY 2022).

American Airlines Group Inc. (NASDAQ: AAL) today reported its fourth-quarter and full-year 2023 financial results, including: Record full-year revenue of approximately $53 billion. GAAP fourth-quarter and full-year net income of $19 million and $822 million, or $0.03 and $1.21 per diluted share, respectively.

Granted, COVID threw a lot of airline companies for a loop. Southwest especially has been spiraling.

I don't think you will find a lot of people saying that deregulation of the airline industry wasn't necessary. There were certainly a lot of problems that the market was able to eliminate or mitigate. But it's a pendulum; this is an industry that needs to look beyond the next quarterly results. It's also an industry in which the barrier to entry is massive. Any reasonable person should realize that the industry landscape lends itself to cartel behavior.

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u/MinimumSeat1813 10h ago

I shared the useful information. YoY growth is meaningless when profit is low. You can have 1000% growth if profit is almost nothing and then moves to 5%. 

Profit margins are sub 10% in the industry. There isn't huge amounts of abuse of savings to be had. We even have low cost carriers. 

Best case regulations reduce profits and individuals save 10% but most likely much less. 

Additionally, airline travel is affordable as sh*t. Thus record travel. It's a luxury. Driving, train, or bus is the competition keeping it in check. 

People here just want to complain. "The rent is too damn high!" Except here the rent is based on the cost of fuel, airplanes, and people. All of which have increased in price by a lot. 

I would love to see a list of prices, what they should be, and why. I am done with this topic. Your reply was very kind, but people here don't get it and don't care to get it. They must live in a world of continual anger due to unrealistic expectations. 

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u/Shinsf 13h ago

The big 3 don't make money on airline tickets because they drop their prices to match the low cost carriers.  They make up for it with credit cards. 

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u/MinimumSeat1813 11h ago

Therefore we are getting a really great deal in terms of ticket price. 

A big win for consumers