American Airlines issued business class tickets to China for $450 as part of a mistake fare. This post is an update in regards to that mistake fare.
I intended on posting an update regarding the great deals that were available for business class flights from Washington DC airports to Beijing on American Airlines for select dates in April/May and September, however, by the time I completed my purchase the deal had all but closed up.
To clarify my position on posting great deals and fares: I won’t post any fares that I haven’t taken to the purchase stage. I wouldn’t want anyone to book something where I didn’t know what would happen or won’t go through.
The situation was as follows:
- Washington DC airports (WAS searches Baltimore, Reagan National, and Dulles) to Beijing (PEK) were pricing for limited dates on American Airlines in business class for $394-456 per person depending on the dates.
- Doing some research, I also found a fare to Shanghai that I didn’t see anyone else post about which was not quite as cheap but still a great deal.
- Ticket prices are often comprised of three groups of charges:
- Taxes – Actual government taxes like the September 11th fee, US customs, etc.
- Base Fare – The amount for which the airline is selling the seat itself
- Fees and Surcharges/Fuel Surcharges – More money the airline can charge you as part of the fare that otherwise benefits them (they don’t have to award as many business points, serves tax benefits, pass through costs to partners).
How did I go about it? And the CFR for those that don’t already know.
I ticketed through Orbitz because of one particular nuance. They allow you to cancel up to 11 PM the following day or within 24 hours, whichever is greater. That is in response to the Department of Transportation (DoT) CFR 399.88 which protects consumers against airlines raising the price of a ticket once it is sold, “even in the case of a mistake”. It states that the consumer also has the right to cancel a flight within 24 hours of booking, or that the consumer should have the right to hold or lock a fare for 24 hours. Almost all airlines and online travel agencies (like Orbitz) have preferred to give you the option to cancel within 24 hours or longer. American Airlines allows you to hold for free, but because they offer this option, they do not need to refund once ticketed. By booking through Orbitz I had the maximum amount of time to cancel for free in case my Chinese ticket impulse purchase conflicted with real-world responsibilities.
This is the most important distinction. According to reports (HT: Lucky, HT: TravelCodex), whether it is legal or not American Airlines may be canceling tickets that were on hold but not ticketed. Mine had cleared.
My reservations were just here… wait, where did my reservation go?
I added our frequent flyer numbers, and the two reservations I made (the first with my family and the second a more expensive flight to Shanghai) both appeared in my reservations when logged into my AAdvantage account. I logged into my account to check a departure time only to find the reservations are gone.
I went into My Trips>Find a reservation and input my record locator from the confirmation emails. The ticket information was still in the system but it refused to show up in my account now.
Did they cancel?
Some of the reports indicated that American had taken the following approach:
- On $0 tickets (base fare) all tickets would be canceled as it violates their “Rule 5”.
- All held tickets would be canceled if they had not yet ticketed.
- Tickets that had more than $0 as the base fare are valid.
If there was a $0 transaction I can understand there is a basis for argument because nothing was truly exchanged, which takes away the protections of a purchase. For $0 there is no purchase. However, if you start charging $0 base fares but putting all of the revenue in surcharges, that is in essence still something exchanged for something else. Look at this $72 fare to Shanghai that ended up costing me $800 for example:
I think even in the $0 cases, American Airlines would have a hard time explaining to the DoT or consumers how non-tax, non-fare surcharges are not simply revenue. It’s a matter of semantics but still holds the same effect for the customer of a base fare with no surcharges.
Held tickets will face the CFR 399.88 issue. If you don’t offer a 24-hour rule either in the form of a hold or a refund, that’s a clear violation and unlike other DoT rulings recently, I don’t think they will respect American Airlines position in this regard.
UPDATE: Rocky from Double Wides Fly added this after he had some on hold that was canceled and he looked into the matter further. He was clear that he is not a lawyer but this is what he understood…
“I actually think held tickets fall under 14 CFR 259.6 (http://liveandletsfly.boardingarea.com/wp-content/uploads/2015/03/Notice_24hour_hold_final20130530.pdf)”
Tickets that charged something for the base fare should be valid and leaked internal memos have stated that they will honor them. So where is my ticket? As you can see above, this is not an insanely cheap fare. Consider for a moment that $800 is about what is competitive for coach on the Washington DC to Shanghai route, and with American Airlines I could always apply one of my eight system-wide upgrades to an $800 coach fare and fly business for the same rate. It’s the same route in the same seat for the same money.
Has anyone else had this issue?