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Consumer's Fair Game in Fare Wars

April 12, 1987|PETER S. GREENBERG | Greenberg is a Los Angeles free-lance writer.

Seats are limited are often the three most misleading words for airline passengers.

Almost anyone trying to reserve discount-fare airline seats these days has come face to face with the reality of how limited these seats can be.

Back on Jan. 29, Continental Airlines fired the latest salvo in the discount air-fare wars when it announced its Maxsaver fares.

Extraordinarily cheap, nonrefundable tickets were on sale to anywhere Continental flew in the United States (except Hawaii). All that was required was that passengers make their reservations at least two days ahead and stay over a Saturday night.

Other airlines rushed to match the fares. It all sounded great. But alas, seats were "limited."

Many people who called to reserve their discount seats on United, Pan Am, American and other airlines quickly discovered that the fares advertised were simply not available for the flights they wanted.

How available are the heavily promoted Maxsaver fares?

Notorious Fare War

This is not the first time that such fare promotion availabilities have been questioned. Last year in Denver there was a notorious airline fare war. At one point, Frontier Airlines lowered its fare between Denver and Colorado Springs to $9. The airline also slashed fares between Denver and Albuquerque to $19 and to Los Angeles the fare was dropped to $39. Other airlines rushed to match the fares.

Seats were "limited." As it turned out, the word limited had been redefined. The fares were not only hard to believe, they were almost impossible to get.

Lots of folks in Denver tried to get seats at these fares, only to be told that the fare was no longer available, that seats had been sold out. They started to complain to state consumer affairs officials.

Soon the Colorado state attorney general wrote a letter to each airline offering the fares, demanding to know whether or not these fares existed and, if so, he wanted the airlines to properly identify the exact number of seats available at those fares.

The airlines responded that the fares as well as the seats existed for the discount flights, but balked at the request for them to list numbers of seats available at discount fares.

Capacity Control

The reason: It's all part of something the airlines like to call capacity control or inventory management--their ability to raise or lower the number of discount seats available on each flight on a daily, sometimes even an hourly basis, depending upon passenger demand.

They also study advance 14-, 30- and 330-day projections of passenger reservations by time of day, day of week and time of year. "As a result," an airline spokesman says, "it's no great secret that we have more discount seats on Tuesdays and Wednesdays than we do Fridays at 5 p.m."

But the real issue is whether or not there are ever any discount seats available on that Friday flight.

Some folks are convinced that those discount seats never existed in the first place.

Recently the Aviation Consumer Action Project (ACAP), a public interest group, petitioned the U.S. Department of Transportation for an immediate directive that would order airlines to establish a certain number of seats it must offer at an advertised price.

ACAP claims that the absence of federal regulations has created a "considerable vacuum" and asked that airlines be required to make at least 10 seats or 10% of the number of seats on a given flight available at advertised levels.

(Under section 411 of the Federal Aviation Administration Act, the Dept. of Transportation can determine whether air fares are offered in an "unfair and deceptive manner" and fine a carrier $1,000 for each violation.)

For Stiff Regulation

But Sen. Howard M. Metzenbaum (D-Ohio), who chairs the Senate Judiciary subcommittee, wants a stiffer regulation. "If an airline is going to advertise a fare," he said during Senate aviation hearings, "then to ask them to make at least 10% of the seats available on each flight is an absurdity. It should be higher."

Now a comprehensive bill just introduced by Metzenbaum attempts to deal with the Maxsaver problem by having the Dept. of Transportation prohibit airlines from advertising a fare for any flight unless at least one-third of the seats will be available at the advertised price. (An airline could still get around the rule if it included a notice in its advertisements that fewer than one-third of the seats on particular flights were available.)

One airline, Sunworld, quickly announced that it will offer a minimum of 15% of seats on each of its flights as discount seats. But Sunworld is the only airline to respond to ACAP's petition or to Metzenbaum's proposed legislation. At this writing, there are no firm assurances from any other airlines that they will allocate a specific percentage of Maxsaver-type seats on each flight.

And so, in the near future, it looks as if the game of capacity controls will continue without effective regulation.

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