Reply To: Should airlines compensate for delays?

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The EU has established regulations for compensating passengers on all forms of transport. The significant point is that all bar the airlines have their liability limited with reference to the fare paid i.e. it is a percentage or a multiple. Airlines remain under an excessive burden with fixed compensation amounts that often represent gross multiples of the actual fare paid – that is plainly unfair, uncompetitive and punitive.

No-one mentions that the cost of air travel in the EU has fallen in real terms since the national carriers dominated it – or rather dictated it. Excessive penalties will stifle development, especially if penalties are imposed on airlines for events quite clearly outside their control.

Travellers, including Business travellers who pay much higher fares than the masses in Economy, often overlook the fact that airlines operate on the smallest of margins – I once worked for an airline that promised a party if it achieved 4.5% – and the imposition of heavily punitive compensation regimes will only serve to see more of them go out of business, further industry consolidation and the emergence of very dominant players who will drive fares up.

All in all, be careful what you wish for!

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