Australian “free” fares must be free from now on

It’s a seductive little move: offer free flights, and then slap the passenger with taxes and additional fees. Tiger Airways just did it this month. It attracts potential customers, generates buzz … all the good stuff that an airline needs in this market. A new law, however, is going to bring all this to a close. Air carriers will have to disclose all the “extra” costs up fronts, and free, for once, will mean free.

And, it’s not just the airlines. This overhaul of consumer protection laws covers any company that sells travel – including hotels and town car companies. It could even rope in dive tour providers.

We can debate who loses with this development forever, but the winners are immediately apparent: anyone who voted for this law looks like a consumer rights champion. Beat up on the airlines, if you’re an Aussie elected official, and you’re really asking the voters to let you keep your job.

March airline plunge softens in April

Passenger traffic is still falling. That’s not going to change for a while. But, the decline slowed in April, signaling that the prolonged sharp dips may be behind us. Some optimists even believe that the worst is over – though I maintain a healthy skepticism.

Note the metric being used: passenger traffic. There’s a lot of mileage between asses in seats and money in the bank. On a positive note, increased passenger traffic means that more people are spending money on travel. Of course, deep discounts are responsible in large part for the increasing traffic. The value of these passengers in dollar terms, therefore, is quite low.

United Airlines reported a traffic drop of 10.5 percent in April 2009 relative to the same month in 2008. Delta and American sustained smaller declines. Southwest, meanwhile, showed a 4.1 percent increase.

And, fares fell.

The average one-way domestic fare paid in the first quarter of 2008 was $213 – compared to $246 for full-year 2008.

For now, however, the airlines believe it’s better to sell seats at any price, especially if they have to put a plane in the air anyway.

Thinking of invoking the “best fare guarantee?” Caveat emptor.

When you’re out comparison shopping for plane tickets, nine times out of ten you’ll find the best fares directly on airline websites. Carriers do this to “train” you to refer to their websites anytime you want to purchase a ticket – and to not shop around. And it’s a reasonable balance, because travel agent websites like Orbitz or Travelocity will charge you a few extra dollars for booking. Running a search on a metacrawler like Kayak or Mobissimo proves this, as often you’ll see prices five to ten dollars lower compared from an individual carrier’s website to something like Expedia.

To further incentivize you to use their websites, most carriers further offer what’s called a “Best Fare Guarantee,” effectively saying that if you find the exact same ticket on another website that is a lower price than theirs, they’ll match the cost and often may give you a voucher for your time.

In theory, this sounds like a good practice, and once in a while you actually do find cheaper fares on third party websites that are tempting to purchase. But filing a claim for an adjustment is harder than you think.Before you even file a claim, you first need to make 100% certain that you’re comparing the exact same ticket between bookings. This includes the:

  • Same date
  • Same flights and flights numbers
  • Same booking class

Assuming all of these have been fastidiously audited, you now need to purchase the more expensive ticket and have your claim reviewed by the airline to see if they can replicate the result. And the airline will do anything to make sure that you don’t fit the bill.

Reading most Best Fare Guarantee terms and conditions, you’ll see that the airline has twenty four hours to get back to you on your claim. Fare pricing is uploaded multiple time every day, however, and is further based on real-time availability. For example, if you book the last deeply discounted “K” fare on Delta.com, all of the remaining fares are going to be in more expensive fare classes and therefore invalid for the claim. Even if there are still seats left in your fare class, ticket prices can change over night, and by the time the reviewing agent verifies your claim the entire cost structure could be different. An unfortunate delay in reviewing, or intentional sandbagging to invalidate your request? Nobody knows.

Another way airlines invalidate your claim is by scrutinizing the booking class. Often times, sites like Orbitz make it difficult (again, intentional?) for you to find the fare class in which you’re booked, so passengers erroneously think that fares are in the same bucket. Your claim auditor at the airline, however, won’t let this fly.

The worst part is, once the airline rejects your claim you’re stuck with your already purchased ticket. If you happen to be inside of the 24 hour return window (for non-refundable tickets), you can act quick and return the ticket and purchase on the other site (if the fare still exists), but the airline is counting on you to be too angry or too late to do this and just give in and pay.

My recommendation? Book via the third party website and take the hours and headache put into getting your fare equalized to the park and play with your kids. Trust me, you’ll be happier that you did it.

Got your own Best Fare Guarantee story? Post it in the comments and we’ll post some success stories.