COVID-19 traveler refunds: Senators urge airlines to refund $10B in canceled flights
Democratic Senators Edward Markey (Mass.) and Richard Blumenthal (Conn.) put the formal request in a letter, sending it out on Monday to Alaska Airlines, Allegiant Air, American Airlines, Delta Air Lines, Frontier Airlines, Hawaiian Airlines, JetBlue Airways, Southwest Airlines, Spirit Airlines and United Airlines. No word if any other lawmakers have backed the senators’ request.
"Although many air travelers have had to cancel flights due to no fault of their own, many airlines have denied them the cash refunds they deserve, and are instead issuing temporary flight credits that are now beginning to expire despite the ongoing health emergency," the letter read. "Accordingly, we write to urge your airline to make all flight credits—including those already issued and those that have expired during the pandemic—valid indefinitely by default."
Lawmakers believe, at minimum, the airlines should not let pandemic-related flight credits expire. However, they want the airlines to offer cash refunds for canceled tickets, either by the traveler or the airline, because of the COVID-19 pandemic. They believe travelers could then use that money for other, unexpected expenses incurred during the pandemic.
"Americans need cash in their pockets to pay for food, housing, and prescriptions during this emergency," the letter continued. "It is unconscionable that airlines are largely refusing to return customers’ money even as the industry sits on more than $10 billion in unused travel credits."
Lawmakers added that cancelation and refund policies are complicated and vary greatly among the different airlines. This, they believe, has left confused travelers with expired credits and "are now at risk of losing the billions of dollars they were effectively forced to loan to the airline industry interest-free." They also noted that travelers may let their credits expire because they’re not safe boarding a plane while the COVID-19 threat remains.
Markey and Blumenthal said they would like an answer from the airlines by May 28.
"We extended ticket validity for tickets purchased between May 1, 2019 and March 31, 2021," United Airlines said in a statement to FOX Television Stations Monday. "Those tickets are extended through March 31, 2022 to give customers extra time to use for travel. Tickets purchased April 1, 2021 and after have a 12-month validity from the date of purchase."
"Delta is giving customers more time to plan and rebook a trip than any other U.S. airline with a travel credit extension that allows for unmatched flexibility, through December 31, 2022 for all tickets purchased or expiring in 2021," the company also said in a statement to FOX Television Stations. "Meanwhile, Delta continues to provide full refunds to eligible passengers requesting them when we have cancelled a flight or made a significant schedule change. Last year, we processed more 6.7 million refunds, totaling over $3 billion."
According to Airlines 4 America, a trade association, U.S. airlines issue $12.84 billion in cash refunds to customers — up 72% year over year – in addition to issuing billions of dollars of travel credits. The group said airlines have also updated their policies to help customers.
Since the pandemic, customers have resorted to legal means to get back their money from canceled tickets. In April 2020, a class-action lawsuit was filed against American, Delta and United airlines over refunds.
Air travel has been rising slowly for more than a year since hitting bottom in mid-April 2020. In 2020, the six biggest U.S. airlines lost $34 billion, and Southwest Airlines suffered its first full-year loss since Richard Nixon was president and gasoline sold for 36 cents a gallon.
The U.S. Centers for Disease Control and Prevention said COVID-19 transmission could easily happen on flights. Travelers are often in close contact with others people, sometimes for several hours, raising the risk of contracting or spreading the virus that causes COVID-19. Masks are necessary on planes because travelers might not be able to keep six feet apart from others, the CDC said.
Airlines disputed the claims, saying they had rigorous practices in place to prevent a COVID-19 spread, pointing to a U.S. Department of Defense study showing there’s a low risk of contracting the coronavirus on a flight given the airplane’s air filtration system.
Nevertheless, the airlines still suffered major losses.
American Airlines said it lost $1.25 billion in the first quarter of 2021 and continued to slash costs, including delaying the delivery of new jets as it waits for air travel to recover from the pandemic.
Delta Air Lines lost $1.2 billion in the first quarter of 2021, more than expected, but executives said that the airline could be profitable by late summer if the budding recovery in air travel continues.
Delta, the last U.S. airline to do so, ended its policy to not sell middle seats in May as air travel recovers and more people become vaccinated against COVID-19. The airline industry was divided over the utility of blocking middle seats to reduce the risk of spreading COVID-19 on a flight. Airlines including Delta, Southwest, Alaska and JetBlue limited seating for months, while United Airlines never did and American did so only briefly.
However, the airline industry is showing signs of a rebound.
Americans set a record for pandemic-era air travel, then broke it again over the Mother’s Day holiday weekend. The Transportation Security Administration said that slightly more than 1.7 million people were screened at airport checkpoints on Sunday, the highest number since March 2020, when travel was collapsing because of the coronavirus outbreak.
However, those crowds were still far smaller than before the pandemic. Sunday’s count was down 29% from the comparable Sunday two years ago, according to TSA.
Global travel may have a higher hill to climb. According to the International Air Transport Association, international passenger demand was down 87.8% in March 2021 compared to March 2019, but it’s a slight improvement from February 2021.
Congress has already stepped in, giving airlines more than $50 billion in aid since the start of the pandemic that went toward payroll, airports and manufacturers.
Southwest Airlines is the first major U.S. airline to report a profit since the pandemic started, as federal payroll aid helped boost the company to a net income of $116 million in the first quarter.
This story has been updated to reflect responses from various airlines. The Associated Press contributed to this report. This story was reported from Los Angeles.