Flier Beware of Fine Print on Restricted Fares

New York, $119. Washington, $147. Miami, $129. That’s some of the big print, bold-face type in a recent big newspaper ad run by TWA.

In small print, at the bottom, are all the “fare conditions” that make it hard to get such fares, including this note: “Most fares are non-refundable” and subject to “cancellation/change of date/itinerary penalties.” Translation: Travelers who change or cancel their flights will pay.

For some time, the general rule has been that the further ahead a seat was booked, the lower the ticket price. Now there’s a codicil, only elliptically noted in ads: The cheaper the fare, the bigger the penalty for changing or canceling plans. By contrast, people who pay regular fare, and often book at the last minute, can “go and come when they want,” says Delta spokesman Dick Jones in Atlanta, “and if they decide not to go, we refund 100% of their ticket.”

Not unexpectedly, the roster of penalties on different fares is so complicated that even airline spokesmen have to “go get the book.” At Eastern and Delta, for example, (and there are exceptions, depending on area and flight), the seven-day, advance-purchase, deepest discount fares are entirely non-refundable; a seven-day-ahead lesser discount fare forfeits 50%, and a two-day-ahead fare forfeits 25%. At TWA, a 30-day advance purchase ticket is non-refundable, a 14-day-ahead discount ticket gets 25% to 50% refund and the seven-day-ahead discount purchases are totally refundable.

Usually, exceptions are made only for death or illness (and only in the immediate family, a United spokesman says), which the passenger must prove with a death certificate or doctor’s letter. Even then, he or she may be permitted a change of flight but not a refund.

Blame the No-Shows

Some airlines also make an exception for simply missing a plane. Eastern, for one, offers a standby ticket on the next available flight if the ticket holder was less than an hour late. United allows two hours. TWA says only that each case is a “judgment call” for the airport supervisor, spokesman Bob Blattner in St. Louis says.

Almost all domestic carriers have cancellation penalties. Indeed, Delta tried to change the approach last fall, applying the larger penalties not to tickets bought furthest ahead but to those bought closest to the flight, “but no one followed Delta’s lead,” says Jones. “We would have been out there all alone, so we suspended the program.”

The penalties are meant “to stimulate travel,” says Karen Ceremsak, an Eastern spokesman, and to help the airlines “better manage inventory,” i.e., control how many seats are solidly sold and at what price. People are drawn to make reservations by the deep discounts, and the stiff penalties encourage them to keep their reservations--a longtime problem for domestic carriers. “People were making reservations on two or three Delta flights,” says Jones, “and we were running up to 30% no-shows.”

This seemed unfair to the airlines, which “see an airline seat as a perishable commodity,” says American Airlines spokesman Al Becker in Dallas. “It’s revenue-generating only on the day it flies,” but unlike theaters and other seat sellers, airlines didn’t charge if people didn’t show up to fill their seats.

The implication is that no-shows were particularly common on low-fare, advance-purchase reservations, notably “the leisure traveler. If you’re making vacation plans,” says Dan Sheehy at United in Chicago, “you usually make reservations several months in advance but don’t always stick to your plan or call and say you changed your mind.”

But as Eastern’s Ceremsak says, “we have no breakdown where the no-shows were.” Some observers, like Dan Smith, head of consumer affairs for the International Airline Passengers Assn. in Dallas, believe that they are “for the most part the business travelers, who need the flexibility,” and book late besides.

What’s more, “non-refundable tickets are a small percentage of total airline tickets,” says Bill Jackman at the Air Transport Assn. in Washington. Their purchasers could not have accounted for that many no-shows before and couldn’t significantly affect the traditional incidence of no-shows--10% to 15% on regular flights, and 20% to 25% on holiday flights. Indeed, one after another airlines say they have no actual figures for the decrease in no-shows since penalties were instituted, although they are sure that there is an effect.

Vulnerability Unknown

One effect is a little more money for airlines: “Even before the penalties,” says Smith, “they had a good computer handle on historic data and knew how much to overbook. Now they get the penalty plus the revenue from the overbooked people who are filling those seats.”

Some of those penalties may surprise the consumer. They’re explained on the ticket, but most reservations and booking, Smith says, “are done over the phone, so you don’t know your vulnerability to the charges before you see the ticket.”

If they’re mentioned at all--and a recent survey by the Massachusetts Office of Consumer Affairs and Business Regulation found that they were “usually not volunteered”--the system is so knotty and the explanation goes by so quickly that consumers may not get it.

Danger of Increase

There may be some valid question whether a consumer shouldn’t just reject a charge he never knowingly contracted to pay. Meantime, given such disclosure problems, an Airline Passenger Protection Act proposed in Congress bears a provision giving ticket buyers the right to cancel a ticket within seven days if it’s mailed to them and two days if it was bought in person. This would give airlines time to resell a seat while giving consumers the chance to review terms and plans.

There’s always the danger, of course, that the airlines’ response will be a price increase. As Smith says, under the penalty system, “the benefit is we do get a lower-cost ticket. At least we think we’re getting one.”