It’s a Buyer’s Market for Discount Air Tickets : Trends: Deals abound as consumers try to sell non-refundable, non-transferable seats. But there are risks for purchasers if officials opt to check travelers’ ID.
You’ll find the notices in classified ad sections of virtually every major newspaper in America, including today’s Times. Under the section marked “Air Travel” or just “Travel” are dozens of ads for highly discounted airline tickets. A typical offering might include:
--Round trip from Los Angeles to Honolulu for $200.
--One way to Seattle for $80.
--New York City to San Francisco, round trip for $170.
--Chicago to Miami, round trip for $90.
The tickets are for regularly scheduled flights on American, United, TWA, Delta, Northwest and other major airlines.
But neither the airlines nor travel agencies are placing the ads. The cheap tickets are being sold by individual travelers who purchased nonrefundable discount tickets from airlines and now can’t use them. Or travelers who flew only in one direction and are now selling the return-flight ticket.
These discounted seats do come with some restrictions, such as a specific travel date and time. So flexibility and spontaneity in making travel plans is important for the buyer.
Among recent placers of newspaper adsis Jennifer , a free-lance artist from Glendale who bought a nonrefundable ticket on Continental for $236 to Hawaii from Los Angeles, but then discovered she couldn’t go because of job commitments. She called the airline to try to change her flight, but was told that it would cost an additional $150. And the airline would not refund her money. She then placed an ad to sell the ticket for $200--and sold it immediately. (Jennifer and all other ticket-sellers in this column spoke on condition of anonymity.)
Steve, a retired military psychologist who lives in San Diego, has advertised a ticket to “fly anywhere in the U.S., Mexico or the Caribbean round trip for $459.” The only restriction: You must fly before Oct. 20, 1991. And you have to fly on Pan Am.
Another recent newspaper ad: “Oakland from LAX, two round-trip tickets for $150.” The original tickets were purchased by a couple and issued in the husband’s name. Pay cash and they’re yours.
Are these bargains too good to be true? On one hand, they are bargains and they are real. Some airline officials estimate that on any given domestic flight there are a handful of passengers flying with tickets purchased from third parties.
But are these tickets legal ?
In all such cases the purchaser flies using the name of the seller.
According to airlines, this practice is illegal.
Actually, it violates published airline tariffs--the contract, written on the back of each flight ticket, entered into between the original passenger and the airline, which specifically states that these tickets are nontransferable.
And yet, thousands of Americans are flying on such tickets--as someone else--every day. The advantage to the seller is that they are able to unload a ticket that the airline told them was worthless if they didn’t use it. To the purchaser, it’s a great last-minute flight deal. And often there’s an additional advantage to the seller: He (or she) usually receives mileage credit from the airline’s frequent flier program for a trip he didn’t even take.
And while many airlines insist that they are aggressively trying to stop the practice, most admit that very few passengers are caught.
Without exception, everyone I interviewed said that they had experienced no problems buying and selling the gray market tickets. In fact, some even claimed the airlines knew they were doing it and simply looked the other way.
“It’s incredibly risk-free,” says Mike, who is selling the $150 Oakland tickets. “We do it all the time and no one at the airport ever asks for identification. In fact, when we tried to refund our tickets, the airline agent first told us that the tickets were nonrefundable, but then said we could try to sell them.”
But what happens if you buy one of these tickets, get to the airport and, in a rare act of airline vigilance, you are suddenly asked for identification? Will you go to jail?
No. There is no federal regulation that prohibits you from buying or selling nonrefundable tickets. Instead, major airlines state that if they discover you are using someone else’s ticket, they will confiscate your ticket and deny you boarding. Then, if you still want to fly on that particular flight, you must ante up the applicable fare for that flight--usually the full unrestricted (and wildly expensive) fare.
“Everyone knows that you are not supposed to fly with someone else’s ticket, but it happens all the time and the airlines know it,” says Ben Hidaji, president of Simply Travel in Beverly Hills.
This doesn’t mean the airlines are happy about it.
“If you’re caught,” says TWA spokesman Jim Faulkner, “you are not allowed to board and the ticket would be confiscated. But I cannot comment on specific procedures. If we give that information out, people will just find another way of beating the system.”
But are there any specific preventive and/or enforcement procedures for airlines to follow?
“It’s really a hit-and-miss thing,” says one airline official who asked not to be identified. “If you do it on a domestic flight, you stand an excellent chance of getting away with it. But with more and more people doing it, let’s just say it now has our attention.”
Northwest claims that it is stepping up its enforcement of properly used tickets. “We have been increasingly able to ID people who are doing this,” says Ray Foss, vice president of sales and marketing systems for Northwest. “It really bothers us.”
And while the sale of nonrefundable tickets is a new phenomenon (since nonrefundable tickets themselves are relatively new), the numbers are definitely growing.
“We haven’t been particularly aggressive in the past,” Foss concedes, “but we are now intending to launch vigorous legal action against anyone we discover doing this. People don’t realize that this is a form of theft. Somehow, an aura has been created that this is OK, but it’s not.”
There are other potential problems to using a gray market ticket besides passenger misidentification. In the event of a flight irregularity (cancellation, bumping, lost baggage or accident), a passenger flying as someone else effectively loses his rights to compensation or other insurance.
When a Northwest Airlines plane crashed in Detroit in 1987, airline officials had to delay notification of next of kin when it was discovered that a number of the deceased passengers weren’t really dead--they had sold their tickets to other people.
The purchasers, whose identities had yet to be determined, were in fact the casualties. Suddenly, the term gray market had acquired a new and sobering meaning.
Still, the odds are very much with you if you’re willing to risk buying someone else’s nonrefundable ticket. And as long as airlines market these discount tickets, there will always be discounts offered by private parties on the already discounted tickets.