Air passenger woes: Congress raises threat of new airline regulations as fix

A Congressional committee grilled airline CEOs at a hearing Tuesday over high-profile customer incidents that raised concerns about the treatment of airline passengers.

Rep. Bill Shuster, R-Pa., chairman of the House transportation committee, raised the specter of increased regulation of airlines to address the issues, if airlines can’t fix the problems on their own.

Some say limited competition due to the domination of the industry by a few airlines decreases the incentive to treat customers well. But Shuster and other members of Congress, with deference to the free market, are hesitant to increase regulation of the industry. And some airlines say they are already introducing policy changes to improve their handling of customers.

Shuster in his written opening statement said “something is clearly broken when we see passengers being treated the way some of them have been treated on recent flights,” citing the now infamous incident when a United Airlines passenger was dragged off a plane and an American Airlines passenger who was struck by her stroller that was yanked away by a flight attendant.

“It’s just common decency and common sense that you don’t treat a person that way, let alone a paying customer,” Shuster said.

He said he does not believe in “over-burdening our businesses with regulation.” But he said “Congress will not hesitate to act, whenever necessary, to ensure your customers are treated with the respect they deserve.”

Atlanta-based Delta Air Lines did not testify at the hearing, but said it has been briefing members of Congress and their staff on the airline’s customer care policies and reliability. “We look forward to working with Congress and the Administration on these critical issues as we move forward,” Delta said in a written statement Tuesday.

Meanwhile, the U.S. Travel Association this week pointed to the domination of the airline industry by a handful of carriers as an issue underlying the problems. The association pointed to the fact that the four biggest airlines control nearly 69 percent of domestic flying.

The industry group said the status quo does not give airlines the incentive to “treat their customers with care and respect at every turn.”

New Jersey Gov. Chris Christie last month called for airline overbooking to be suspended in the wake of the United dragging incident. Although the incident was not the result of overbooking and was instead due to the airline’s attempt to accommodate crew members to get to another flight.

Southwest Airlines has pledged to stop overbooking effective May 8, but also said there will still be occasionally flights that are over capacity due to substitutes with smaller aircraft, weight-and-balance restrictions, an inoperable seat or a disabled passenger who may need two seats..

“I will be honest: While we’ve been looking at this issue for many years, the recent events related to overbooking did cause us to stop and pause and take a look at this again,” said Southwest chief commercial officer Bob Jordan. Dallas-based Southwest is the second-largest carrier at Hartsfield-Jackson International Airport

Delta CEO Ed Bastian has said he doesn’t believe more legislation is needed and said Atlanta-based Delta has done a better job of managing overbookings.

Bastian last month called overbooking “a valid business process.” He added that “there are things that happen that create overbooking situations beyond just pure oversales,” citing weather delays and weight-and-balance issues.

“I don’t think we need additional legislation to try to control how the airlines run their businesses in this space,” Bastian said during comments in a conference call last Wednesday on the company’s quarterly financial results. “It’s not a question in my opinion as to whether you overbook. It’s how you manage overbooked situations…. The key is managing it before you get to the boarding process, and that’s what [Delta] has done a very effective and efficient job at.”

Some members of Congress also expressed reservations about increased regulation.

Rep. Rick Crawford, R-Ark., said he doesn’t want “the government to get involved to solve problems in a competitive marketplace,” but added “that means that the industry has to do some self-regulation to demonstrate that you don’t need interference from Congress.”

United Airlines CEO Oscar Munoz, who testified at the hearing, responded: “It’s shameful that an event like the one that we had at United has to drive this kind of conversation…. It was a mistake of epic proportions.”

But, he said, “This will make us better.” United last week announced several improvements to its customer policies, including limiting the use of law enforcement when removing customers from flights.

Bill McGee, who testified at the hearing as an aviation consultant with Consumers Union, said the Consumers Union has never recommended re-regulation of the airline industry.

But, “it’s clear that when you leave customer service up to the airlines on many issues over the years — tarmac delays and other things — they do not do what’s best for their…. customers.”

Rep. Shuster told airlines that he expects to see some of the airlines’ profits “driven back into the company to make sure the customer experience is better.”

“If Congress takes action,” he warned, “it’s going to be one size fits all and it’s not going to fit anybody at the end of the day.”

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