US Airways May Alter Nonrefundable Policy, AA Reportedly To Match

Just days after declaring nonrefundable tickets will lose their value once the associated flight departs, US Airways senior vice president B. Ben Baldanza acknowledged the carrier will rethink its new position if no competitors follow suit. However, Dow Jones Business News reported American Airlines on Oct. 1 will begin matching the US Airways policy and also will charge lower-paying customers $100 to wait for alternate flights on standby lists. US Airways completely disallowed customers on nonrefundable fares from waiting standby.

American officials were not available for comment and it remains to be seen how other major carriers will react between now and the start of the business week on Tuesday.

"Even if people match, we are listening to customer feedback and carefully considering it," Baldanza said. "If we need to make adjustments to make it more palatable, we will do that." He added that changes may be necessary specifically if United Airlines, US Airways' would-be codeshare partner, does not adopt the nonrefundable fare rule.

Baldanza also acknowledged the major dilemma in asking important corporate clients--most of which use a mix of refundable and nonrefundable fares--to swallow the new policy changes. "We have taken a strong view on several major issues and we will see the ultimate effect and what our ultimate position will need to be," Baldanza said. "But we also cannot ignore the economic reality of changed traveler behavior."

He added that US Airways currently is working to ensure all customers, regardless of distribution channel, "know exactly what they are buying."

Meanwhile, the Association of Corporate Travel Executives added its voice to the growing chorus responding to the US Airways decision. "The recent action taken by US Airways--in creating a divergent pricing structure--is actually a step toward airfare reform," said ACTE executive director Nancy Holtzman. "The association regrets that this decision was made without broader industry discussion or dialogue, however."

Separately, US Airways will implement a new policy on Oct. 1 that eliminates corporate discounts on nonrefundable H, K and V fares. The carrier's corporate clients will be asked to formally change their contracts through an addendum by Sept. 16. Baldanza said the Oct. 1 date is not a postponement but rather provides a realistic timeframe for implementation. Several other airlines, either formally or informally, have eliminated lower-fare buckets from corporate discount programs.

In other US Airways news, the carrier detailed its fall and winter schedule. That schedule, which represents a 13 percent drop in systemwide capacity by chopping 200 daily mainline and 100 daily regional flights, maintains service to all 203 destinations. Some markets, notably Charlotte and New York LaGuardia, actually will see new flights added to the schedule.