When I book tickets, everything in the user interface leads me to believe that I've bought a seat on a plane that will take me from one airport to another at a given time. That is the only explicit agreement most users ever see when they buy a ticket.Josh wrote:The passengers and the airline didn't agree to an auction in the event all the passengers who booked on that flight showed up.
Most are surprised to learn that the real contract is not the one they saw in the process of buying a ticket. That's a kind of bait and switch. They never saw the contract that says that the airline didn't actually say they will give you that seat if they want to give it to someone else.
Doesn't that depend on the rate at which passengers are bumped? Let's see what that rate is.Josh wrote:If they did, I'd agree with you, but the price for tickets would be a lot higher. And there still have to be limits. Could the passengers all collude not to accept the airline's offer until it hit $1 million?
How much do you think the airline would have to offer these 6 passengers to delay a flight? How much would that add to the cost of the tickets for the other 100,000 fliers? Let's do a thought experiment. Suppose the upper limit an airline is willing to raise the tickets is 1%, and they want passengers to pay for the full additional cost through ticket prices. Suppose a ticket costs $500 on average after raising the tickets by $5 to guarantee seats.In 2016, the 12 biggest U.S.-based airlines denied boarding to 475,000 passengers, including about 41,000 who were removed from flights involuntarily last year.
That’s a rate of about 6 passengers who are involuntarily bumped from flights for every 100,000 fliers, according to the U.S. Transportation Department. That rate dropped from about 7 fliers for every 100,000 passengers in 2015.
We now have 500,000 available to try to coax these passengers to give up their seats, which means we can offer each passenger up to 83,333.33 to delay their flight. If a passenger were willing to give up a seat for less money than that, we would need to raise prices by much less than 1%. I'm guessing that if I told people I would give them a cash check for $1,000 or $2,000, I could get a handful of people to give up their seat on most flights.