Joseph Prezioso / AFP via Getty Images
Airlines are again appealing for state aid, only this time they want a break from some federal regulations instead of financial aid.
A global industry group warns that many of the world’s airlines are running out of money and on the brink of economic collapse and therefore cannot afford to give customers reimbursement for canceled flights.
Regulations in the US, Europe and elsewhere require airlines to reimburse the fares paid by customers when the airline cancels their flight.
And since the coronovirus outbreak, airlines have canceled thousands of flights a day demand for air travel.
But instead of respecting their obligation to repay, many airlines have only offered coupons and credits for future trips, which customers often have to use before the end of the year.
Many airline passengers and consumer groups have filed complaints against the airlines for not following the reimbursement rules. A Minnesota man filed a lawsuit against United Airlines on Monday for his refusal to refund him, and last week a lawsuit was filed in Canada against several airlines and travel companies over their refusal to provide a refund.
The head of the International Air Transport Association (IATA), the group representing air carriers around the world, says airlines are losing billions and burning through their cash reserves.
“The most important element for us is to avoid running out of cash, so repaying the canceled ticket for us is almost unbearable financially,” IATA Director General Alexandre De Juniac said at an online news conference on Tuesday.
The industry lobby group is asking governments to relax the reimbursement terms and let the airlines offer travel credits and coupons instead. But in the midst of a growing number of consumer complaints, the US Department of Transportation warned airlines last week that they must provide refunds when canceling flights.
“The airline’s obligation to provide reimbursements, including the fare and any fees charged for services that a passenger cannot use, does not end when the aircraft malfunction is beyond the airline’s control,” the department said in a statement.
However, it is important to note that airlines are not required to provide reimbursement to people who cancel their own travel plans, which is a common situation many would-be travelers find. Between stay in home orders and travel alerts and restrictions, families who have canceled spring trips and holidays before the airline cancels its flight and is forced to accept travel credits or coupons that may expire before the travel restrictions are lifted.
But at least two airlines, Delta and United, have extended the time for customers to use travel vouchers until May 2022, instead of the standard one year from the date of purchase.