Airlines set record low rates for lost baggage, bumped passengers

The latest federal statistics that measure the performance of the nation's airlines offered some good news for passengers and some bad.

First the good news: In 2011, the airlines set records for the lowest rate of lost or mishandled baggage and the lowest rate of passengers bumped from overbooked flights.

In 2011, the Transportation Department received 3.39 reports of mishandled bags per 1,000 passengers, the lowest rate since the agency began keeping track of lost bag reports in 1988.

U.S. airlines also reported a rate of 0.81 passengers bumped from overbooked flights per 10,000 passengers, the lowest rate since the department started keeping such records in 1995.

Airline representatives attributed the improved performance to better technology, training and procedures.

"Our members are committed to and are delivering levels of safety and customer service that no other industry, given its complexity, matches," said Nicholas E. Calio, president of Airlines for America, a trade group that represents the nation's largest airlines. "The airlines are working to improve on that every day, making air travel even safer and more efficient for passengers and shippers."

But the latest statistics also had some bad news.

For 2011, the Transportation Department received 11,545 complaints about airlines' service, a 5.1% increase from 10,988 complaints in 2010, and 31% higher than the 8,821 complaints filed in 2009.

United exchanges gift cards for airline miles

If you received a stack of gift cards for the holidays, United Air Lines has a deal to turn those cards into airline miles.

Frequent flier members with United, which will soon merge with Continental Airlines, can exchange gift cards from 60 major retailers for frequent flier miles in United's MileagePlus program.

The program is unusual because most airline mileage programs convert accumulated frequent flier miles into credit toward hotel room stays, car rentals or meals. The new United program flips that concept. But it makes sense because a survey last fall said that 80% of holiday shoppers planned to give gift cards.

To exchange gift cards for miles, members of the MileagePlus program must log into their account, select the retailer that issued the gift card and plug in the card information. The cards from such retailers as Home Depot, Starbucks and Kmart must have a minimum of $25 in unused credit. The airline then deposits the frequent flier miles into the member's account.

But the program is not getting soaring reviews from consumer experts.

For example, United says the exchange rate for the unused credit on the gift cards depends on "market pricing" that can change over time. Consumers can back out of the deal if they don't like the rate offered by the program.

"So, you don't know what the exchange rate is until you go through the whole process," said Tim Winship, publisher of, a website that offers tips and updates on frequent flier programs.

A reader of his website was offered an exchange rate of 3.75 cents per mile for a Home Depot gift card, Winship said, but the market rate for frequent flier miles is closer to 1.2 cents per mile.

"Based on the pricing I've seen so far, I don't think you are going to get a very good value from it," he said.

Andrea Woroch, consumer expert at Kinoli Inc., a Colorado Internet marketing company, said consumers might get a better exchange by simply selling their unused gift cards to friends and then using the cash to buy airline miles.

United spokesman Charles Hobart declined to discuss the program's exchange rate, but he defended the offer. He said it gives airline passengers a way to get value out of unwanted gift cards.

"We think it offers members a convenient way to earn those miles," Hobart said.

KLM program combines seat picking, social media

Speaking of unusual airline offers, KLM Royal Dutch Airlines launched a program this month that lets you see profiles of people on your flight so you can pick a seat near them.

To participate in the Meet and Seat program, you must share your Facebook or LinkedIn profile with other passengers on the same flights who have chosen to share their profiles. You can do so when you book your flight online.

For now, the program is available only for KLM flights between Amsterdam and New York, San Francisco and Sao Paulo, Brazil, but the airline promises to expand the program to other cities.

"With Meet & Seat, KLM takes social networking a step forward," said Erik Varwijk, managing director for the airline. "This new service connects passengers and aims to give them a more inspirational journey."

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