IATA Says Proposed Passenger Compensation Rules Will Not Reduce Disruptions
The association’s director said that the proposed ruling singles out airlines.
The International Air Transport Association (IATA) is speaking out against the US Department of Transportation (DOT) and the Biden Administration’s proposal to mandate airlines to compensate travelers affected by flight delays and cancelations. Criticizing the mandate, the association said it would only raise costs and not be the solution to flight problems.
The comments come as the industry has suffered from air traffic control (ATC) and pilot shortages for months. IATA said the needs played a role in delays last year and have already impacted flights this year.
A problem or solution?
On Monday, the DOT announced its plan to launch a new ruling requiring airlines to compensate passengers and cover expenses for meals, hotels, and rebooking when the carrier is responsible for flight issues that leave passengers stranded.
In a statement released Tuesday, IATA Director General Willie Walsh said the new ruling would only contribute to the industry’s existing problems.
“Airlines work hard to get their passengers to their destinations on time and do their best to minimize the impacts of any delays. Airlines already have financial incentives to get their passengers to their destination as planned. Managing delays and cancellations is very costly for airlines. And passengers can take their loyalty to other carriers if they are not satisfied with service levels. The added layer of expense that this regulation will impose will not create a new incentive, but it will have to be recouped –which is likely to have an impact on ticket prices.”
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Ongoing ATC shortages
IATA claims that the DOT’s regulation could give unrealistic expectations to travelers since most weather is typically the leading cause of flight issues which is out of the airline’s control. Additionally, the association blamed ATC shortages for causing delays in 2022 and this year. Simple Flying previously reported that the big three carriers are cutting flights from New York City area airports this summer due to controller shortages.
The association also attributed airports and aircraft manufacturing companies to flight delays and cancellations.
“Runway closures and equipment failures also contribute to delays and cancellations,” the IATA explained. “Additionally, supply chain issues in the aircraft manufacturing and support sectors have resulted in aircraft delivery delays and parts shortages over which airlines have little or no control but which impact reliability.”
Nonetheless, US Transportation Secretary Pete Buttigieg said airlines should pay up if they become responsible for inconveniencing passengers.
“When an airline causes a flight cancellation or delay, passengers should not foot the bill,” Buttigieg said. “This rule would, for the first time in U.S. history, propose to require airlines to compensate passengers and cover expenses such as meals, hotels, and rebooking in cases where the airline has caused a cancellation or significant delay.”
“Singling out airlines”
Walsh explained that airlines should not be singled out because the industry comprises several elements contributing to a smooth operation.
“Aviation is a highly integrated activity involving a number of different partners, each of whom has a vital role in ensuring the smooth operation of the air transport system,” Walsh said. “Instead of singling out airlines as this proposal most assuredly does, the Biden Administration should be working toward ensuring a fully funded FAA, a fully staffed controller workforce, and completing the rollout of the decades-delayed FAA NextGen air traffic control modernization program.”
The DOT said that the rulemaking is planned and has yet to indicate a date when it could go into effect.
