Many travel managers welcomed American Airlines' move last month to ease restrictions on nonrefundable ticket policies, but ensuing decisions by competitors left the industry with inconsistent rules.
Northwest Airlines, followed by partner Delta Air Lines, matched American by permitting travelers on nonrefundable tickets to re-book a canceled itinerary up to one year later and went a step further in waiving the requirement that travelers call ahead to cancel the originally scheduled trip
(BTN, Aug. 25).Delta told BTN that customers still are "strongly encouraged" but "not required" to change, or at least cancel, nonrefundable tickets beforehand. The carrier also expanded its new rules to international routes, with certain restrictions.
Continental Airlines, a partner of both Delta and Northwest, matched American but did not implement the softer policy. When asked if its policy requiring travelers to call in advance is a competitive disadvantage versus the traveler-friendlier policies at Northwest and Delta, Continental did not respond, and American sales vice president Craig Kreeger said, "Customers accept that it is reasonable we ask them to call ahead."
United Airlines also matched American but not Northwest and Delta. US Airways, which last year led the industry in applying the more restrictive "use it or lose it" nonrefundable ticket rules
(BTN, Sept. 9, 2002), has not changed its policy and continues to void nonrefundable tickets when travelers are no-shows.
Despite the differences, the new policies generally are a positive for travel managers trying to keep down travel costs. Bill Davidson, manager of corporate travel and meetings services for International Sematech in Austin, Texas, however, is concerned the relaxed rules will send the wrong message to travelers.
"With the penalty of losing the entire ticket value hanging over their heads, all of our travelers pulled it together and were very careful about their travel plans. We didn't end up with a lot of worthless tickets as we expected," Davidson said. "Now, because our travelers can afford to be less concerned about rescheduling their trips because of the one-year latitude, a certain percentage of them will end up putting it off until the last minute, and it will be too late. The less restrictive position, while absolutely the right thing to do from a customer service perspective, actually serves to condone apathy among some folks, and that will ultimately increase the numbers of worthless tickets and corporate revenues tied up in wait."
David Rifkin, president and CEO of Ansonia, Conn.-based Rifkin Travel, a $20 million corporate travel agency, added that calling ahead to cancel "is a common courtesy," and that advance cancellations make it easier for a travel agency to validate unused tickets and accomplish other administrative functions. "Now we need systems to deal with all the different policies," he said, noting that notification systems developed by many travel management companies are "not needed" for travelers with nonrefundable tickets on Northwest and Delta, for example. As such, Rifkin hoped American and others would come to a standard industry policy.