Saturday, April 29, 2017

Southwest Airlines to end overbooking, cites United incident

Southwest Airlines said it will end the practice of overbooking flights at some point in the current quarter.

Chairman and CEO Gary Kelly conceded to reporters on an April 27 conference call that the recent United Airlines passenger bumping incident put overbooking “under a bright light” and led Dallas-based Southwest, which had already been considering ending the practice, to move forward with stopping overbooking.

“We’ve been thinking about it for a long time and now is the right time to do it,” Kelly said. “It wasn’t on my list this month to work on [before the United incident, which placed overbooking] under a bright light and hey, why not do it now? We’re ready to do it and we’re going to get it done.”

The incident in which United passenger David Dao was involuntarily bumped and dragged off of an aircraft occurred because United and regional operator Republic Airlines determined his seat was needed for a crew member, not overbooking. But United has said the flight was in fact initially overbooked, and the practice of airline overbooking became a major topic in the media in the immediate aftermath of the Dao incident.

Kelly said making a commitment not to overbook flights is in line with other consumer-friendly aspects of the Southwest product, such as not charging checked bag fees and flight change fees. “For quite some time, we have been challenging ourselves to make the travel experience better for our customers and [an overbooking leading to a bumped passenger is] one of the pain points we’d like to eliminate,” he said. “As time has gone by, we have been fortunate to have fewer and fewer and fewer no-shows, so the gross amount of the problem is far less today than it was 20 years ago. We don’t overbook much at all already. On a 143-seat airplane, we might overbook by one.”

Southwest CFO Tammy Romo said the economic impact on Southwest of ending overbooking is expected to be “really fairly small,” adding, “The net impact is really not that meaningful.”

Kelly cautioned that, even absent overbooking, there will still be instances in which a passenger gets bumped. “If we took bookings for a Boeing 737-800 and that airplane type is not available [on the day of the flight for mechanical or other reasons] and we substitute a smaller type,” then passengers may have to be bumped, he explained. There is also the potential for needing seats for crew, but “we work very hard to avoid displacing our customers” for crew, Kelly said.

(Aaron Karp - ATWOnline News)

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