UPDATE: Unlike Congress, U.S. Passengers Seem Extraordinarily Forgiving Toward Airlines
May 11, 2017
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  • A member of Congress called the industry ‘an absolute joke,’ but overall customers are happy

    At congressional hearings over the past week on the state of U.S. airlines, politicians accused the industry of anti-competitive behavior, diminishing flight quality and increasing hidden fees. Customers, however, seem to be kinder to the industry.

    Recent surveys among North American airline passengers suggest satisfaction is at an all-time high. Overall customer satisfaction with airlines increased for the fifth consecutive year, reaching 756 on a 1,000 point scale — a 30 point change from last year, one new survey by marketing company (https://skift.com/2017/05/10/new-j-d-power-survey-says-airlines-passenger-satisfaction-is-at-all-time-high/) J.D. Power found. There is one important caveat, however. The survey only covered between April 2016 and March 2017, so the events of the last six weeks — 300 flights canceled by Spirit Airlines (http://www.marketwatch.com/story/this-is-why-a-brawl-broke-out-among-spirit-passengers-in-fort-lauderdale-2017-05-09) and the United Airlines incident where a 69-year-old doctor was dragged off a fight — and for which the airline’s CEO Oscar Munoz repeatedly apologized — weren’t included.

    Still, another survey released in the wake of those airline PR disasters showed that most people would still fly United Airlines (UAL), the company that took most of the flak for the industry over the last six weeks. Some 57% of millennials said they would continue to fly with United, according to this survey of more than 2,300 young fliers (http://www.marketwatch.com/story/nearly-half-of-young-americans-wont-fly-united-anymore-2017-04-21) released last month after the recent controversies. That’s good news for airlines: Millennials are now the most frequent business travelers of any generation — millennials took 7.4 business trips last year, versus 6.4 for Generation Xers and 6.3 for baby boomers, according to an October 2016 report from travel and hospitality marketing firm MMGY Global.

    And there’s still time for the industry to recover. Some 85% percent of people who traveled by air in 2016 said they were “very satisfied” or “somewhat satisfied” with their air travel experience, up from 80% in 2015, according to a new study released in March from trade organization Airlines for America (http://www.marketwatch.com/story/the-worst-airline-in-america-is-2017-02-28). The increasingly positive view of air travel can be attributed to enhancements in onboard food and entertainment and expedited security screening at airports, John Heimlich, chief economist for the company that conducted the survey, Ipsos Public Affairs.

    Others noted that consumers are aware that it is safer — and cheaper — to fly now than ever before, even if the experience itself feels more fraught. “Although airlines are showing welcome improvement, I don’t think things are nearly as bad as recent news reports suggest,” said George Hobica, president of Airfarewatchdog, a low-airfare alert and advice site. “They still have a long way to go before matching the golden days of air travel. But those days are never coming back.” (Despite the year-over-year improvement in customer satisfaction, however, airlines ranked seventh-to-last out of 43 industries in the American Customer Satisfaction Index in 2016.)

    Congress was somewhat less enthusiastic about recent events. Following the high-profile controversy involving United Airlines (UAL) physically removing a passenger (http://www.marketwatch.com/story/passenger-dragged-off-united-flight-agrees-settlement-with-airline-attorneys-2017-04-27) from a flight in April so one of its employees could fly, both the House Transportation & Infrastructure Committee and the Senate Commerce Committee held hearings last week to discuss the state of the airline industry. “It’s an absolute joke that there’s competition within the airline industry,’ Rep. Duncan Hunter (R.-Calif.) said. “The airline industry has become anti-competitive and consumers are being hurt in the process.”

    Members of Congress and consumer groups, including the Alliance for Aviation Across America, highlighted anti-competitive behavior and poor customer service, after a series of mergers over the last 12 years have reduced the 10 biggest U.S. airlines to four main carriers. In the most recent merger, Alaska Air Group (ALK) in December acquired Virgin America (http://www.marketwatch.com/story/alaska-air-virgin-america-merger-wins-antitrust-approval-2016-12-06) and plans to kill off the latter brand. House members in the hearing said these changes (http://www.marketwatch.com/story/alaska-airlines-to-drop-virgin-america-brand-in-2019-2017-03-22) are decreasing competition in the industry and making conditions worse for travelers.

    Others complained about shrinking seats on flights. American Airlines (AAL)recently announced (http://www.marketwatch.com/story/american-airlines-to-shrink-legroom-for-these-coach-passengers-2017-05-03) it would shrink legroom on flights from 31 inches to 30 inches — as small as budget airlines like and Spirit Airlines (SAVE). Uncomfortable seats are the top complaint for air travelers (http://www.marketwatch.com/story/american-airlines-to-shrink-legroom-for-these-coach-passengers-2017-05-03), with 77% citing it as the most hated aspect of flying. “Talk to any passenger–they feel that they are being treated as self-loading cargo,” Sen. Bill Nelson, (D.-Fla.) said at the congressional hearing.

    “It is frustrating for me to hear that you’re all about the consumer when every time I get on a commercial flight there’s nothing but complaints from consumers because there is not enough room, there is not enough legroom, there is not enough choice even though you claim to have choice and that’s the unfortunate part of all of this,” Sen. Catherine Cortez Masto (D.-Nev.) told United Airlines President Scott Kirby (http://thehill.com/regulation/transportation/331943-united-airlines-grilled-at-senate-hearing) at a Senate subcommittee hearing.

    In the industry’s defense, airfares are historically low, helped by low gas prices, a spokeswoman for trade organization Airlines for America said. Airlines safely operate 27,000 flights to more than 800 destinations a year, she said, delivering more than 2 million passengers each day. “U.S. airlines are focused and committed to treating every passenger with the respect and dignity they deserve,” she said.