I previously wrote the counter-position to this post which states that United has no right to come after customers for buying hidden-city tickets. In this post, it’s clear that United has every right to pursue customers who abuse the system.
Airlines Compete on City Pairs, Not Routes
If an airline has nonstop flights on a given route, they know that many consumers will pay a premium for the shorter travel journey, simplicity and time savings. However, airlines can’t run nonstop flights from everywhere to everywhere else. They will often compete against other carriers who offer a direct routing by pricing their trip with a connection for cheaper, even though it is more expensive for the airline.
Airlines are competing on markets, not on flights.
In some twisted logic, it does make sense for the carrier to charge the way they do. For example, United is never going to be competitive on a flight to Charlotte from Los Angeles. American has tons of non-stop flights all day every day, while United offers none. Those who prefer a direct flight will pay a little more, those who want a better price will take a connection.
American prices the direct return at $420 roundtrip. For those who are curious, I chose a date well into the future, January 16-23 Wednesday daytime flights.
The same route on United is less expensive if you’re willing to take a connection in Houston. You can save even more on Frontier if you travel light.
Hidden-City Ticketing is a Misuse of Their Product
It’s plainly not how it was intended to be sold or used. Any other violation of a purchase of a product could have the same kind of restrictions though usually less draconian. Rather than charging customers for misuse of a product, most companies simply void the warranty making them no longer responsible for the product conditions. This is one of the many remedies United has at their disposal.
It Takes Advantages of Discounts
Using another analogy, United’s practice makes sense in the context of kid’s meals/senior citizen discounts. Some restaurants offer discounted meals which may offer a lower price in relation to an item. For example, if a senior citizen does not actually qualify for a discount but is given one anyway, that manipulates the business for the customer’s gain to the detriment of the restaurant. The restaurant takes a hit on their revenue for that customer when the customer is knowingly misrepresenting themselves to incur a lower price.
If an adult walks into Applebee’s and orders a kid’s meal, they may be served but the restaurant is in their right to (and should) say “no.” Kid’s meals may offer a lower unit price in relation to the cost of the item vs. a full menu equivalent. For example, if a kid’s meal offers a 4 oz Cheeseburger with a half order of fries for $3.99 with a dessert at the end and an included drink, a savvy customer might save money over the standard price of $10.99 for an 8 oz burger with twice the fries, no drink and no dessert. That customer could probably buy two kids meals and save themselves some money by manipulating the situation and ordering takeout. That too causes damage to the restaurant by the customer.
United Has Every Right to Demand Financial Remedy, But Should They?
I included in my prior post the official language from United, they have certainly written in plenty of protection into their Contract of Carriage.
On the one hand, United Airlines has to do whatever they can to stop the invalid discounting of their product, especially following ill-intent and purposeful misuse by the customer. They have that duty to their shareholders and to other customers who fly the airline honestly without manipulating the situation.
But this is a terrible idea.
Perhaps United felt as though sending a letter to one person would make the carrier whole on this one customer, but on the off-chance that it becomes a larger issue (and it has) now the carrier that dragged Dr. Dao off an airplane is reminding the public of their pricing model which penalizes the honest with higher fares, and then tries to go after the dishonest in an effort that is almost assuredly unenforceable in a court of law.
There are myriad ways to send a message to the masses regarding this type of misuse of their product but had the reader not have submitted the letter he received, or had the blogger decided not to publish, this matter would have remained private. Therefore, United was not trying to send a message to all Hidden-City ticketers, it was trying to send a message to one and garner revenue from him. Revenue that they were entitled to certainly, but it was probably not a great marketing move. The average consumer believes airlines are evil (they are not), but for a year coming off of the Dr. Dao incident among others… I just can’t see how this could possibly have the intended outcome.
What do you think? Should United (and other carriers) take stronger action against customers that abuse their policies? Was this a good time to pursue such action or does it do more harm than good? Will it keep hidden-city customers from misusing their product?