So, did I miss anything over the long weekend?
From the looks of JetBlue CEO David Neeleman’s face on news shows this morning, I get the feeling it was a sleepless few days for the BlueCrew. Remember how I said before that by not pre-canceling their flights, the airline was helping a lot more people than it hurt? Well I’ll have to take that one back. Continuing to cancel up to a quarter of their flights through the entire holiday weekend most certainly had to have hurt a lot more than pre-canceling would have done.
What happened? Well in short they didn’t have the systems in place to recover from such a mammoth disruption. It has taken days to get everyone in the right place, including customers who may have been stranded. This has turned uglier than anyone could have imagined.
So where do we go from here? Nope, not to a government-mandated Passenger Bill of Rights. Why do that when just the threat of one will get airlines to act?
Remember, the airlines created their Customers First plan after the last threat appeared. That was good enough for 5 years until the recent incidents have thrust it back into the spotlight. So once again, the airlines are reacting.
First, American put a four-hour cap on the amount of time they’d leave a customer on the plane. (Thanks, Global Traveller and Upgrade: Travel Better) They also promised technology upgrades to help prevent the problems from occurring again.
JetBlue took a much stronger approach by introducing its own Customer Bill of Rights this morning. You can read the announcement here, but I’ll summarize myself.
*They’ll notify customers of delays, cancellations, and diversions along with the cause
*They won’t keep customers on board an aircraft on the ground for more than 5 hours
*If a flight lands but can’t taxi to a gate, it pushes back and can’t takeoff, or it is just plain delayed due to circumstances under JetBlue’s control (not weather or ATC), customers will be compensated with vouchers worth $25 to the full price of the roundtrip ticket depending on the length of the delay
*If a flight is canceled due to something under JetBlue’s control (not weather or air traffic control) less than 12 hours before scheduled departure, each customer will get either a full refund or a full credit as well as a voucher for the entire roundtrip cost of the flight
*If a customer is involuntarily denied boarding due to overbooking, they’ll get $1,000. (Don’t get too excited by this one. The airline doesn’t overbook, so this will rarely happen.)
Of course, they’re also going to be making technological changes to ensure that this meltdown doesn’t happen again. I think this is quite proactive and it goes a long way to address people’s concens. True, they aren’t handing out cash, but they will be handing out a lot of vouchers. If you’d like to hear more about the reasoning straight from the horse’s mouth, watch this YouTube video from David Neeleman.
By the way, all of these policies are retroactive to February 14, the day of the weather debacle, so people on those flights will be receiving compensation. It doesn’t help people get where they’re going right now, but it does at least make an effort. Is it enough? We’ll see if it satisfies people or whether more is necessary. Personally, I’m glad to see airlines responding. It tells me once again that there’s no need for further regulation. Simply the threat will be enough.
(Edited Feb 20 at 226p to add overbooking info)
It is a nice gesture, but I have a few questions only the immortal crank-master can answer.
1. Is there anyway from available data you can estimate how much this policy would have cost jetblue over the last year (based on assumptions around voucher value)? Is this a big potential liability for them?
2. How big a freakin’ hole is there in this little policy around weather and ATC? I mean, really, they can still argue that ALL their delays and disasters this past week were due to WEATHER! clearly they’re not doing that now, with the full glare of the world’s media on them, but let me see you get your voucher in two months.
– The Cranky Frog
WABC in New york is stating that the restrictions are more severe than most think:
The compensation will only apply to delays and problems “within JetBlue’s control” and EXCLUDES problems with weather, air traffic control, crew shortages, maintenance problems and failure to recover from any of those problems by the second day.
The two big whoppers are crew shortages and maintenance problems. They are trying to pull a fast one.
Bonjour Cranky Frog,
1) I’m sure I could, but I unfortunately don’t have the time to get to that. I’ll keep an eye out for press mentions, because I’m sure analysts are cranking away at this as we speak.
I do know that the problems last week will cost about $30m. Check out this article for more detail.
It is certainly a potentially large liability, but I would hope they’ve done the math. Hopefully their systems allow them to look at repurchase rate from customers who would receive a voucher. I would assume they’ve decided that the goodwill generated and the ability to retain a customer is worth the extra cost. That leads me to . . .
2) Despite the second comment here, I’m almost positive they aren’t excluding maintenance and crew shortages. In their actual policy, which is now posted here, you can see that they are only paying for some of these things if they occur as a “controllable irregularity.” Unfortunately, that term isn’t defined anywhere on the page, nor is it defined in the contract of carriage, so it’s completely unhelpful. Still, maintenance and crew are absolutely controllable, so I’m guessing they are included. If not, this is a sham.
So, the people who will be compensated are those who were canceled or delayed by a controllable irregularity, those stuck on the ground after landing for more than half and hour, and those stuck on the ground more than 3 hours before departure. Oh, they also added that they’ll pay $1,000 for involuntary denied boardings (updated in the post). That may sound generous, but they don’t overbook. This will be a rare occurrence.
I would bet the big costs are for those controllable irregularity delays. They don’t cancel a lot of flights, so those won’t be an issue. It’s the delays that will get them, but even that is probably low if you don’t count weather or air traffic control.
My 2 cents worth (you can read more on my blog).
1) Vouchers are not worth anywhere near their face value
2) As I expected The Cranky Flier picked up on the Controllable Irregularity issue and lack of definition. The EU regulation on which this seems to be loosely based does spell out in some more detail what get out clauses the airlines can use (ie where unreasonable to hold them to account). Unfortunately even with legal recourse for dissatisfied passengers it seems the airlines are getting away with a lot more than passengers would expect.
So, I’m with CF – this policy isn’t going to cost Jet Blue very much in the long run.
I too found it an obvious omission that Controlled Irregularity is capitalized in their bill of rights yet it is not defined. In legal-eze capitalized words normally have specific definitions…I’ll bet JetBlue knows what it is. They do their flying public a disservice by not sharing…its all about honest communication with the customer.
I’d like to agree with you and say that every crew or maintenance delay is controllable…it would make my job soooo much easier. But the reality is they are not. The airlines I have been associated have dissected both maintenance and crew delays into controllable and uncontrollable events. I would be stunned if JetBlue DIDN’T use the controlled irregularity card to get out of many delays.
The B6 Bill of Rights is nothing new to distressed customers when it comes to compensation. Without publicly declaring compensation B6 would regularly give out vouchers and/or refunds for poor operations and tech stops. You could even receive $10-$15 if the TVs were not working on transcon or Florida flights. It is more of a reflection of the company trying to improve goodwill after such a horrible operation and the intense media scrutiny. Though, there are some provisions that are stronger such as IDB compensation which is insignifcant due to the lack of DBs, and also a flights delayed 30-60 minutes may have received nothing in the past. The dollar value of vouchers will go up but not enough to make a dent in the margins.