Should airline customers receive cash instead of vouchers?
Airline travel has basically come to a standstill.
On Wednesday, executives from the airline industry gave an update on loses and how the $25 billion in grants and $25 billion from the CARES Act to the airline industry have been used.
Consumer Reports argues while, yes, the airlines might be losing money right now, but questions what happened to the billions of dollars in baggage fees, and other charges they made passengers pay.
The review site said as of Wednesday, Spirit, JetBlue and Allegient were the only airlines offering refunds while others are giving vouchers due to COVID-19.
Carlos Fassi, who travels often, said getting a voucher for a future flight would be fine.
“I booked through Delta and the flight was really to see family, I have family in Milan and I spend most summers out there," Fassi said.
But Bill McGee, Consumer Reports’ aviation advisor, said vouchers should be an option and not the standard.
That’s why the consumer advocacy group started a petition that as of Wednesday afternoon had garnered almost 88,000 signatures. It will be sent to law makers, the Department of Transportation and airline CEOs.
“We’re hearing alot about the airlines’ woes and their financial woes. Let’s not forget they made billions of dollars in record profits in the last few years. Those profits just evaporated most of it in stock. buybacks and executive compensation, and now for the airlines to say were on the brink of bankruptcy, well, they didn’t manage their finances very well," McGee said.
According to the Department of Transportation, airlines made a profit of $14.8 billion in 2019 after taxes. It’s their seventh year in a row of making profit.
But at a Wednesday Senate hearing, the trade group Airlines for America said the industry burns through $10 billion in cash a month, averaging fewer than two dozen passengers per domestic flight.
McGee challenges that.
“If we are going to have a national discussion about the airlines finances, we welcome that discussion, because then were going to talk about the billions of dollars in what they call ancillary revenue, all those fees that nickel and dime you, the baggage fees and the fees to select your seat and for pre-boarding. Where did all that money go?” McGee said.
It’s not completely up to the airlines whether they want to give out vouchers or refunds. It’s the Department of Transportation that can make it mandatory for every airline to give passengers their money back.
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