It's a familiar dance. Congress maneuvers to pass new regulations on businesses in response to constituent demands, and lobbyists and CEOs fight those new regulations to ensure that their profitability and stock price are not negatively affected.

Yesterday, American Airlines CEO Doug Parker spoke to reporters at the Airlines for America (one of those industry lobbyists I was talking about) 2018 Commercial Aviation Summit in Washington, D.C. And, when he spoke with reporters, he revealed that American and other airlines might be forced to drop a wildly popular perk if Congress includes a variety of burdensome regulations in a bill that will provide the Federal Aviation Administration with its funding for the next year.

The perk that is under fire? Refundable tickets.

Currently, most airlines offer passengers (often for an additional fee) refundable tickets. That is, if your plans change, you can rebook to a different flight, or get a refund or credit toward a future flight.

According to Parker, if Congress includes certain new regulations in the FAA funding bill that the airline industry objects to (including restrictions to add-on fees for such things as allowing passengers to choose and reserve a particular seat, or those fees to check luggage on a flight), then refundable tickets would "go away."

Continued Parker, "That's where I think we would end up in this case. I think we'd end up with non-refundable tickets."

Imagine for a moment a world where, if you decided to make any change to your ticket -- new destination, new day, new time -- your original ticket would be worthless and you would have to buy a brand-new one at full cost. Not a pretty picture.

The current FAA budget expires on September 30, so the pressure is on Congress to get the new funding bill passed. We'll soon find out if Parker and the rest of the airline industry get their way. I personally suspect they will. 

Published on: Sep 13, 2018