Thursday 17 February 2005

Whenever I hear the word rights, I reach for my revolver

And I've just been given another "right":
Air passengers who are unable to board their flights because of overbooking, cancellations or flight delays can now demand greater compensation.
Tim Worstall understands what's wrong with this right, so to speak:
There’s the problem. The compensation rates are fixed, fixed at a level which makes sense only in light of the charges made by the legacy airlines for their full price seats. If you’ve bought a 10 pound ticket on Ryan Air (motto, "No fu**ing refunds, what part of that don’t you understand?") why on earth should you get 300 quid compensation if they’ve over booked it? You knew, when you bought the ticket, what you were getting as chips travel with lower service levels and less reliability than the full service airlines.
The outcome of this is obvious: the low-cost airlines will have to increase their fares to compensate them for this new "right". Will British politicians be up in arms about this? I don't expect too many of them will be coming to the aid of Ryanair or EasyJet, not to mention their passengers. Well, they should - especially those here in Scotland. According to today's Herald tourist visitors to Scotland are increasing.

And why?

"European figures were helped by the rapid growth of low-cost flights to Britain from Europe, especially from new EU countries."
So when you B&B goes bust or your local pub closes down you can thank the EU. But at least nobody here on the edge of Europe will be "profiting" from travellers.

1 comment:

David Farrer said...

Comments made on previous template:

ohn b
Triticale - things work the way you describe in the US *because* passengers have the right to compensation from airlines. If they didn't, the airlines wouldn't compensate them. 
S2 - absolutely spot on.

23 February 2005, 17:17:09 GMT
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Squander Two
Airlines do that here, too, including some of the low-fares ones. 
I don't know about Ryanair, but EasyJet won't be much affected by the overbooking problem. It's persistent lateness that they suffer from. 
These rights shouldn't cost any properly run business any money. The whole point of paying out compensation for mistakes is not to make them. I never use EasyJet, because of bitter experience of their "service". That's nothing to do with low fares: Go were brilliant and various other low-fares operators, such as FlyBE and BMIBaby, are perfectly OK, in my experience. EasyJet have a policy at their call centre that no customer may ever speak to a manager, and they refuse to allow themselves sufficient turnaround times at airports, resulting in all their evening flights being late. These policies do not save them money; they drive away customers. I have helped to run call centres in my time, so I know that their hopelessly out-of-date and long discredited attitude to customer service is costing them a fortune — and that's before any of their planes even leave the ground. As are most things, come to think of it. 
If they hire a decent troubleshooting manager, they'll be able to ignore this new law without increasing their fares. My prediction is that they won't do that.

22 February 2005, 13:15:58 GMT
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In the US this is handled via the mmarket. "We're overbooked - who will take a delay in return for minor recompense? Not enough people? Okay, who will take a delay in return for a bit more recompense?" Usually frequent flier miles or a seat upgrade is enough that cheap travellers who aren't in a hurry will solve the airline's problem for them.

20 February 2005, 06:20:35 GMT
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Neil Craig
According to the Radio Scotland item on this the idea came directly from the Council of Ministers which does indeed suggest flag carrier's influence. 
Last year I spoke at the Lib Dem conference in favour of reducing running expenses &/or increasing subsidies so that our island airports could have zero landing charges (because of the low numbers landing charges average about twice the flight charges & because of that the numbers are low).  
The sort of economic illiteracy proposed here will drive up low end prices & devastate any chance of making getting to the islands easier than getting to Paris. Interestingly enough the large majority of phoners-in understood this argument & disagreed with the plummy accented, frequent flying charity worker the BBC had as their main guest.

17 February 2005, 19:07:48 GMT
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Trace this legislation back to its source, and you will certainly find a legacy airline lobbyist or executive whispering in the ears of a few key European Commissioners. Bribes, blackmail, favours owed, favours granted...

17 February 2005, 18:37:10 GMT