Web Site for Resale of Air Tickets Shows Promise, but It's Still a Fledgling

In an industry that's built a reputation around exasperating rules and regulations, nonrefundable airline tickets rank as a major annoyance. Sure, you can apply the value of an unused ticket to a future flight on the same carrier, but you'll typically have to fork over a $100 service fee first.

Want to transfer the ticket to someone else? Too bad. Thanks to "positive I.D." policies that took effect in the wake of terrorism fears in the 1980s, airlines have eliminated the once-common practice of selling tickets via newspaper ads or campus ride boards.

Enter FairAir (http://www.fairair.com), an innovative San Francisco-based company that lets travelers who buy tickets through its Web site transfer or resell them online with the blessing of its partner airlines. The site launched May 22 with nearly 10,000 users and four airlines: America West, Midway, National and Northwest.

Nearly two years in the making, FairAir has already run into turbulence. Most airlines have steered clear of the concept. They fear speculators would snap up tickets to popular events or destinations and resell them at a huge profit, or that corporate travel managers would use the company to buy tickets in advance and assign actual names at the last minute, thus avoiding high coach fares.

Although the fledgling site does a good job of explaining how the buying and selling process works, FairAir has a long way to go before fulfilling its lofty promise of supplying "airline tickets without the baggage."

For starters, would-be buyers, who pay FairAir a $9.95-per-ticket transaction fee on top of the listed fare, have a limited choice of flights and routes. Combined, FairAir's participating airlines represent about only 15% of the U.S. market. And only two, National and Midway, have committed to selling FairAir tickets system wide. Northwest currently offers flights through FairAir in seven trial markets, most operating to or through Detroit, one of the airline's hubs. America West hasn't decided on its level of participation.

A recent check on FairAir for a trip from Los Angeles to New York's JFK leaving June 7 and returning June 10 showed four outbound and four returning flights, all on National. The lowest-priced round-trip combination, including FairAir's $9.95 fee, turned out to be $379.95, versus $425 if booked through National's site.

But in other cases, FairAir's prices are much higher than published advance purchase fares. They're designed to appeal primarily to business travelers who aren't locked into a corporate travel policy. To sell or transfer a ticket, FairAir customers pay another fee, shared with the participating airline. FairAir charges 6% of the original price or a $24.95 minimum to change the name on a ticket, and 6% of the sales price (or a $9.95 minimum) if and when a ticket is resold.

Co-founder Frank Levy hopes to license the company's technology to other travel sites, including the airlines' own.


Electronic Explorer appears monthly. Bly welcomes readers' comments; her e-mail address is LSBly@aol .com.

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