I tried as hard as I could to get my A380 post up today, but I just ran out of time. I have over 100 pictures, a dozen videos, and a lot of thoughts to process, so it’s going to have to wait one more day. Instead, take a look at some of my continuing coverage from last week at NBTA.
At NBTA last week, the airline CEO roundtable had both Montie Brewer from Air Canada and Richard Anderson from Delta get up on-stage and talk to the crowd. At the very end, there was a heated exchange between Richard and the audience that I thought would be an interesting story to tell here.
After a handful of questions, we were finally down to the last one before the session was over. A corporate travel manager (the most important attendees at the show) stood at the microphone and asked why it was that when she booked all this travel for her employees and they had to change who was going on the trip, she had to pay such a high fee. She finished with “I bought that ticket, it’s my ticket, so why can’t I [change the name on] it?” That question brought on a chorus of cheers and applause from the audience.
Delta CEO Richard Anderson shot back by asking, “Why wouldn’t you just buy 2,000 tickets under John Doe and change the name later?” Then the crowd really lost it. They started yelling, “Yeah, why not? Great idea!” and all that kind of stuff. Richard yelled, “NO!” into the mike and that pretty much set people off.
He looked at Montie Brewer and had him chime in at which point he said, “Actually, on Air Canada you can.” Clearly he was pointing to the pass product that Air Canada has successfully offered, but that didn’t help Richard’s cause. Ultimately, Richard said something about segmentation in the market which just confused most of the attendees and that was that.
Not exactly the best discussion there, but let’s talk about why airlines don’t offer name changes. It IS about segmentation in the market. See, if you book early, you can get a better deal. But if you have the ability to change the name on the ticket, then you end up with ticket brokers like you have at concerts. Someone will buy all the tickets and then sell them at a profit to last minute travelers. That price will still be less than what Delta will charge you, so you’ll still buy from the ticket broker.
So why don’t we just do it that way, you ask? Well, the ticket prices would have to rise dramatically. This would mean that very few people would buy from the airline at the last minute, so the early booking prices would have to rise to compensate for that loss.
Now in my opinion, I don’t see this as being a terrible idea if it can be structured right. I would love to resell my ticket, so why can’t the airlines just work with someone like StubHub and create a market for reselling (name changing) where they can actually take a piece of the action? The numbers would clearly need to be worked out, but I tend to think it could be a very interesting differentiator, especially in the corporate world.
The key for the airline is controlling the market and taking a transaction fee each time it happens. One of these days, I’ll get around to crunching those numbers to see how it could work.
What do you all think?
I think the best solution for this is the pass products that Air Canada has. I personally have used their individual passes, and an organization I work with uses the corporate passes. Sometimes I use my pass, sometimes I don’t. It all really depends on the segment and fare. For the segments I tend to fly, the pass price is only cheaper some of the time. But, the other half of the time, it is a good deal.
The other nice thing about the pass is they have low price passes, and high price passes. Low price passes only book into certain fare buckets, while the high price pass books into a more flexible fare bucket – which gives a frequent AC flyer more benies (upgrades &c.)
I’m not too convinced the world needs a solution that deals with flexible name changes. My gut feel is this is a classic solution in search of a problem, and while you’re right, CF, that the numbers would need to be crunched to see if your solution is revenue positive, my gut feeling is that the potential loss in last-minute booking revenue (multiple times that of leisure revenue) cannot be compensated for by any kind of “cut” that the airlines would take by working with a ticket broker type company.
Not to mention, airlines have far more important things to sort out these days.
I think the answer to the “why not” posed by this question, is that most air carriers are just tinkering at the edges rather than looking at fundamentally new ways of doing business. AC has been somewhat of an exception in this, but it is worth noting that it competes in a far more limited market as well.
Back in 2001 or so a company called FairAir tried this and failed quickly and miserably – the airlines basically wouldn’t go along with it (National and Midway – hahahahahaha – signed up and Northwest trialed it briefly in a handful of markets). You paid a $10 fee on top of the ticket price, then paid 6% to re-sell the ticket on their marketplace. You can read all the details here:
Ticket booklets or passes have been around for a long time..they come and go. They can and do work well in shuttle type markets with very high density travel..
Ok, I see your point, especially for the leisure traveling classes, but… Often time I’m flying around on a Y class ticket that cost as much as $1000 more than the leisure traveler paid. Sometimes my business schedule changes and someone else must go in my place. So, why not let my employer change the name on the ticket so long as it goes to someone else at the same company?
Limit it to the full fare unrestricted tickets or something similar. At time of purchase require the company to list potential names, limit to to 3 or 4 total. Then at a specified time, 24 hrs pre flight, require a final decision on who will fly.
Something like this will please corporate travel accountants and probably increase corporate travel overall, all while airlines don’t really lose anything, i.e. not creating a black market for airline tickets.
I got the impression from this article at WSJ (http://blogs.wsj.com/middleseat/2008/07/30/more-anger-over-another-airline-fee/) that travel managers have to pay a higher fare already when they do a name change. Is that correct? (I really have no idea.)
If that’s the case, I don’t think Delta’s $150 fee is needed and the fare increase is enough.
If anything, I think Delta should be nice to the corporate travel managers who give them so much business.
Dan – I believe that’s correct, but it’s really just following their change fare policy. Any change incurs $150 in addition to the difference in fare. I hate the change fee at these high levels, but it’s consistent with the way they apply it elsewhere.
The most annoying thing is when you book online and something goes wrong – you get the confirmation email – and **** – thats not the right name.
Even if you contact the airline immediately (I’m talking BA here) they point blank refuse to change the name – although in my case I am sure it was an error on their part.
Basically you throw away the money and start over – my blood pressure is rising again here so I need to stop :-)
A full fare unrestricted ticket doesn’t need a name change. You can just refund the original passenger’s ticket and issue a new one for the new passenger. The only issue is the company might have to temporary have to account for the cost of two tickets, depending on how long it takes the airline to issue a refund.
You might run into issues if the flight is full, but a good agent at the airline should be able to help there.
I am wondering though. Some 10 years ago name changes were not a problem! How did it work then?!
Lena – Good question. If a ticket is refundable, you can just refund the ticket for free and get a name change. Not sure why it would have been easier 10 years ago for non-refundable tickets, but maybe just the lower change fee made it more palatable.
Some airlines have a no-questions asked 24-hour free cancellation policy on all tickets, refundable or not. United has this, not sure who else. I think Delta.
flightjunkie – Yes, I believe the last go-around with the Customers First proposal either allows you to cancel within 24 hours or hold for 24 hours before purchasing. Different airlines handle it differently. On American, you can hold for 24 hours before purchasing. I prefer it that way, because then you don’t have to deal with the refund process, but it still should be easy enough.
CF, the funny thing is you can hold a ticket with UA for 24 hours, and cancel obviously without paying anything… or you can hold, consider, then purchase and STILL have a 24 hour free period to cancel. The fact that the reservation was previously held for 24 hours doesn’t matter.
Great, what happens when I need 2 tickets, and there are 2 left, but StubHub has one and eBayTicketSeller90210 has the other? Now I have to pay a consolidator to pay the ticket brokers to pay the airline? There is a way to get changeable tickets and it’s to buy a high priced ticket. If we want to build changeability into ALL tickets then the price of ALL tickets is going to go up. Anon Coward the Leisure Traveller does NOT want to pay extra just to subsidize Corporate Travel Managers’ budgets!!!!!!!!@$*(&
In the not too distant past, nobody matched the name on your ticket with a government ID when you went to board the plane. You would see tickets advertised in the newspaper classified ads as, e.g. EWR-ORD, coach, male, $100 or whatever. But, as some morons are fond of saying, 9/11 changed everything.
Greetings I need help desperately, I’m flying to Israel on the 30th of December with AL ITILIA, I booked the Ticket with JETCOMBO.COM, the problem is that I’m under the process of changing my current name legally, I booked my ticket under my future new name thinking I would have the new name changed by now. the process has taken more than what I thought, and all I have is my still legal old name Dalcy, now both Al Italia and the online agency Jet Combo, don’t want to change the name, and Jet combo wants to charge me 350dls fee to cancel the ticket, what should I do? I’m very upset with these people, I need to fly on the 30, and I don’t have proof of the new change process
how can I have them change my name ?
Dalcy – Unfortunately, this is a very tough one to fix. For international travel, your name on the ticket needs to match the name on the passport. If you can escalate it high enough, some airlines will finally give in and let you do this, but it’s a very rare situtation. And if you’ve read my comments on Alitalia in the past, you can probably imagine that the people at the top won’t exactly be talking to me anytime soon. I wish I could help.
CF – JetCombo has already escalated with Alitalia and they have already agreed (for a fee) to do the name change for Dalcy. All they need is evidence (any evidence) that the old name and the new name refer to the same person. Dalcy has been informed that he may fax this information to JetCombo and we will be happy to assist.
Thanks for chiming in, JetCombo. Hopefully this solves the problem.