American Airlines Offering Some Travelers Free Flights To China After Glitch

For five hours in mid-March world travelers were able to book American Airlines flights from select U.S. cities to China for bargain prices because of a glitch. While the carrier honored tickets that had been paid for in full, it canceled hundreds of trips that were placed on a 24-hour price hold. Now, as part of an agreement with the Department of Transportation, those passengers are eligible for a free – or significantly discounted – trip to China. 

The agreement [PDF] puts an end to a months-long investigation into whether the airline violated the 24-hour reservation hold rule and engaged in unfair and deceptive trade practices by not honoring erroneously discounted ticket prices that had yet to be paid for.

During the technical error, which occurred between 5 p.m. and 10 p.m. (EST) on March 17, American’s website offered business class tickets to Shanghai or Beijing, China for a base fare of $0 to $20.

The full fare for the mistakenly priced tickets, including taxes, fees, and carrier-imposed fees, ranged from $400 to $800 per ticket. This price represented a severely discounted trip when compared to the average full-fare of a business class ticket for the cities which typically ranges from $4,500 to $5,000.

In all, 1,194 reservations for 1,634 passengers were either put on hold for 24 hours or booked.

The crux of the issue settled in this week’s agreement involves the 605 reservations for approximately 830 passengers who placed the sale price tickets on a 24-hour hold.

DOT guidelines [PDF] on the 24-hour reservation requirement, which has been in effect since 2012, states that as long as a customer books a non-refundable ticket at least seven days ahead of the scheduled departure, an airline is required to offer one of two options: allow that customer to change or cancel the trip within 24 hours without penalty, or hold that reservation at the current price for 24 hours without payment.

American Airlines subscribes to the latter option. The problem with the price glitch is that after the five-hour issue was found, the carrier canceled the reservations placed on hold before the 24-hour time limit — a violation of DOT guidelines.

According to the consent order, the Office of Aviation Enforcement and Proceedings received over 100 complaints from consumers alleging that American improperly canceled tickets prior to the hold expiration.

American defended its action, noting that it believed that a rash of social media posts about the glitch resulted in many customers placing flights on the 24-hour hold in “bad faith, and not on the honest belief that a good deal was available.”

Under the deal, which could come at a $1 million cost for the carrier, American agreed to provide free economy class tickets or a $1,500 discount on a business class ticket for these passengers.

While a free or heavily discounted flight to China might seem like a good compromise for the airline, it comes with the condition that the trips will not accrue miles for the passenger’s frequent flyer account.

Those who choose the $0 economy ticket offer will still have to pay taxes and fees totaling about $450 per ticket.

Quartz reports that American doesn’t expect many travelers to take the airline up on the deal because of the restriction on reward points.

This isn’t the first time American has agreed to honor cheap fares booked during glitches.

In August, the carrier announced it would allow a majority of customers who booked discounted flights on international routes by changing the country of origin to Brazil to continue with their travel plans.

Customers who’d set their country of residence to Brazil had been able to score cheap tickets when the site swapped the current exchange rate: R$1.00 is about $0.29 U.S., so if you switch those around, you get very cheap plane tickets, which is what appears to have happened.

Still, after reviewing the bookings, American told Consumerist that “a small number have been canceled based on how the traveler portrayed their country of residence.”

[via Quartz]