Current:Home > StocksRekubit-Flight fare prices skyrocketed following Southwest's meltdown. Was it price gouging? -Nova Finance Academy
Rekubit-Flight fare prices skyrocketed following Southwest's meltdown. Was it price gouging?
Chainkeen View
Date:2025-04-09 01:30:55
As if canceled flights and Rekubitlost luggage weren't enough of a hassle, would-be Southwest Airlines passengers faced another hurdle to their holiday travel this week: High fares on other carriers.
Southwest announced on Thursday it would resume normal operations this weekend, after canceling roughly 13,000 flights in the last week. Many of those who tried to find flights on different airlines encountered sky-high prices — in some cases, triple or quadruple the rate for the same route in the last few months.
Take, for example, a one-way ticket from Chicago to Denver, two of the cities impacted the most by Southwest's operations errors. Those Googling on Thursday for an afternoon ticket would've found the best price at Delta Air Lines: $599. A week ago, the price of the same flight was $139.
But even routes that weren't impacted by the storm, like a flight from Los Angeles to San Francisco, were starting at $415 on United, more than four times higher than the cost three days ago.
The trend was strong enough to raise questions even for those who weren't slighted by Southwest. Were airlines taking advantage of weary travelers?
Before you start throwing around the term "price-gouging," though, consider what some experts told NPR this week.
Yes, fares are super high. But so is demand
"This kind of last-minute-booking price spike is actually fairly normal," said Sally French, a lead travel writer for NerdWallet.
"Unlike with other forms of travel where you might find a great last-minute hotel room or cruise cabin that the company is trying to fill, airfares rarely offer last-minute deals."
Kyle Potter, executive editor of Thrifty Traveler, said last-minute fares are always more expensive in part because, at this late in the booking game, supply of open seats is incredibly low.
"Planes are routinely 90-95%, even 100% full on a normal day these days. And demand right now is about as high as it gets. [We're] heading into the New Year, plus the storm has added to that," he told NPR.
Not to mention Southwest's relative size: The airline is one of the largest carriers in the country. That means that hundreds of thousands of Southwest customers were suddenly stranded this week, all simultaneously searching fare sites as they snaked through rebooking lines, texting their families who were at home doing the same.
"I really think part of what we're seeing play out here is less about the price itself and more about record-high awareness of these pricing patterns," Potter said. "Hundreds of thousands, even millions, of Americans are suddenly scrambling to find a last-minute ticket on another carrier. Plenty more are just looking out of curiosity."
Laura Lindsay, a global travel trends expert for Skyscanner, agrees that sudden change in inventory as travelers snap up seats is having an impact.
"Airlines use complicated algorithms to set their pricing [...] The one factor which outweighs all of these and is the ultimate determiner for the price paid: demand," she said.
"Flight prices are all based on supply and demand, and when demand is high, so are the airfares."
What you're seeing on that search tool might not be an economy seat
Potter said there's also an "alphabet soup" of fare class offerings, which each come with their own rules, restrictions and, yep, price.
"Airlines regularly pull certain fares from sale in the waning days before a flight – they don't want to offload their cheapest fare classes last minute and may need to keep some seats open for crew, upgrades, flight changes, etc.," Potter said.
Potter said a good practice is to check your eye-popping fare with the airline's website. Sometimes clicking through might reveal it as a business or first-class ticket.
You should also check the options again later: Sometimes an airline will add back a cheaper economy seat when they finalize crew schedules or flight changes.
Airlines said they'd limit fare increases through the weekend, but the details are fuzzy
As Southwest's cancellation wave drags on, airlines including American, Alaska, Delta and United all said they'd impose fare caps domestically for the next few days.
NPR requested specifics from the airlines, including a list of cities impacted and ceilings for the caps. None elaborated on their policies. A lack of price transparency is standard operating procedure for the highly competitive aviation industry.
"Fare caps are built into Alaska's everyday pricing model," said the West Coast-based airline. "In addition, we have further lowered fares in select cities and we're doing everything we can to get guests, whose travel was impacted by winter storms, to their destinations."
United Airlines said it capped fares through Saturday with a focus on "domestic and Latin American markets served by Southwest".
American Airlines said it first notified customers of the price cap rules via Twitter replies to screenshots showing thousand-dollar flights.
In an interview with Nexstar Media, U.S. Transportation Secretary Pete Buttigieg said he was working with other airlines to ensure they're offering affordable fares, but acknowledged that his power to enforce such fares was limited.
"We're going to look at every authority that we legally have, but, again, we're really expecting airlines to go beyond the legal minimum and do the right thing," he said. "It shouldn't take an enforcement action from our department in order to get people taken care of."
Those who suspect airlines are mistreating them can file a consumer protection complaint with USDOT. The department was unable to provide NPR with specific complaint numbers for the last week, but described the number as "surging".
One more thing: Don't bet on Southwest reimbursing your fare if you switch airlines
If you do decide to pay up for a new airline ticket, keep in mind that Southwest has no legal obligation to reimburse you for the difference.
Southwest has said they'll honor "reasonable requests" for reimbursement, but it's unclear what might constitute "reasonable". (Customers looking to make those reimbursement requests should use this self-service portal, the company has said).
This summer, Southwest told USDOT it would pay for meals, hotel accommodations and ground transportation for customers facing overnight cancellations. But it didn't agree it would cover rebooking on another airline when some of its competitors did.
There's nothing stopping Southwest from changing any of those policies now.
The Biden administration has proposed new rules around airline fees, but as it currently stands, U.S. law currently only requires airlines to offer a full refund after a cancellation.
veryGood! (97)
Related
- Opinion: Gianni Infantino, FIFA sell souls and 2034 World Cup for Saudi Arabia's billions
- Funeral of Russian opposition leader Alexei Navalny to be held on Friday, his spokesperson says
- Funko pops the premium bubble with limited edition Project Fred toys
- Expanding wildfires force Texas nuclear facility to pause operations
- Former Syrian official arrested in California who oversaw prison charged with torture
- The Smokehouse Creek Fire in Texas has charred more than 250,000 acres with no containment
- What time does 'Survivor' Season 46 start? Premiere date, episode sneak peak, where to watch
- Leap day deals 2024: Get discounts and free food from Wendy's, Chipotle, Krispy Kreme, more
- Working Well: When holidays present rude customers, taking breaks and the high road preserve peace
- In the mood for a sweet, off-beat murder mystery? 'Elsbeth' is on the case
Ranking
- Charges tied to China weigh on GM in Q4, but profit and revenue top expectations
- Texas wildfires forces shutdown at nuclear weapon facility. Here is what we know
- Horoscopes Today, February 27, 2024
- How Hakeem Jeffries’ Black Baptist upbringing and deep-rooted faith shapes his House leadership
- Rolling Loud 2024: Lineup, how to stream the world's largest hip hop music festival
- NYC Mayor Eric Adams calls for expanded cooperation between police and immigration authorities
- Taylor Swift Sends Love to Australia Despite Dad's Alleged Assault Incident
- Jury finds 2 men guilty on all counts in Jam Master Jay murder trial
Recommendation
Chuck Scarborough signs off: Hoda Kotb, Al Roker tribute legendary New York anchor
Gary Sinise Receives Support From Alyssa Milano, Katharine McPhee and More After Son’s Death
LeBron James is Bronny's Dad first, and he shows his experience is guiding light
Beyoncé's country music is causing a surge in cowboy fashion, according to global searches
The FTC says 'gamified' online job scams by WhatsApp and text on the rise. What to know.
Biden's top health expert travels to Alabama to hear from IVF families upset by court ruling
Missouri advocates gather signatures for abortion legalization, but GOP hurdle looms
Jam Master Jay killing: Men convicted of murder nearly 22 years after Run-DMC's rapper's death