What Biden’s Decree Means for Airlines

President Joe Biden’s broad executive order to crack down on corporate consolidation and encourage competition also includes some potential relief for airline passengers who have been plagued by rising fees in recent years.

The order signed at a ceremony Friday instructs the Department of Transportation “to consider issuing clear rules requiring reimbursement of charges when baggage is delayed or when service is not actually provided, such as when the Wi -If the plane or the in-flight entertainment system is down, “according to a White House fact sheet on the order.

It also orders the agency “to consider issuing rules requiring that baggage, change and cancellation charges be clearly disclosed to the customer,” the document said.

These fees have exploded over the past 15 years.

“The top ten airlines collected $ 35.2 billion in ancillary costs in 2018, up from just $ 1.2 billion in 2007,” the fact sheet says, while noting that the top four commercial airlines control almost two thirds of the domestic market.

“Reduced competition contributes to higher costs such as baggage and cancellation fees. These fees are often increased at the same time, which demonstrates a lack of significant competitive pressure, and are often hidden from consumers at the time of purchase, ”says the information sheet.

Brian Deese, director of the National Economic Council, previewed the airlines guidelines at the White House press briefing last week, and said he will “establish a clearer initial disclosure of fees” to that “consumers have more and more information and a better understanding of what they really are paying.”

Under current DOT rules, passengers are entitled to a refund if their baggage is lost, but not if it is delayed.

The ordinance also calls for an update “of enforcement activities to address the inability of airlines to timely reimburse flights canceled due to the COVID-19 pandemic” as well as “measures to support developing airports and increasing their capacity and improving congestion at airports. management.”

In a statement, the Airlines for America industry trade group said the competition in the industry is already “robust” and “has generated unprecedented levels of affordability and affordability, benefiting the customer at all. levels ”.

“This vigorous competition has led to historically low airfares – even as US airlines carried a record 2.5 million passengers every day in 2019,” said the statement from the group, which includes American Airlines, Delta Air Lines, JetBlue Airways, Southwest Airlines and United. Airlines companies.