In light of the class action lawsuit against Air Canada, I thought I’d share my thoughts on mistake fares. For this post, I will leave the legal issues aside and rather offer what I think would be an ideal solution.
In the Air Canada class action lawsuit, 10 one-way business class flights were booked for $800 when they should have costed $8,000. As a result, Air Canada rescinded the tickets and issued a full refund.
I think that there have been two types of mistake fares. The ones that are on purpose, and the ones that aren’t. For the ones that are on purpose, you can be sure that they will honour those tickets. It is a way of mass marketing their airline and give themselves good publicity for doing a nice customer friendly move by honouring the tickets. I have no real evidence to support that they do this on purpose, but the idea does make a lot of sense.
Think about it, once there is a mistake fare, the forums, social media, etc. go nuts! The airline’s name is tossed around and they gain a lot of exposure. This is definitely cheaper than buying air time for a commercial on television. Honouring the mistake makes for amazing publicity because they show a nice customer service move.
On the other hand, when a mistake is actually made, they have two choices, honour it and go for the nice publicity, or cancel the tickets and offer a full refund. At the end of the day, it is easy to honour it if they can justify it monetarily.
Someone once asked me, if we see a mistake fare and it looks too good to be true, should I go for it? I would say yes, there is very little risk associated with it. Worse case scenario, as we have seen in the past, is that we will be issued a full refund anyway.
I’m actually torn on whether airlines should be forced, legally, to honour mistake fares. The argument is obvious to force them to honour mistake fares. If that is what they publish, that is what they should agree to. However, mistakes can happen, because there is a human factor involved, so I can sympathize with the airlines. Imagine the person who actually made the clerical error, how horrible they must feel, probably even fired the next day.
On the other hand, we don’t want airlines to abuse customers and withdraw fares left and right claiming that it was a mistake. So certain rules do need to be in place to protect both sides. The law can have a role to play, but at the end of the day, I think it’s more about the relationship between airline and passengers. The real question really is whether airlines want to build a good or bad relationship with their passengers?
Now that I have established the background information, here is what I think is best. Assuming the mistake wasn’t done on purpose, (because if it was done on purpose you can be sure they are honouring the tickets), they just need to do a simple calculation.
If the cost associated with honouring the fares is acceptable, just honour it and get some favourable publicity. But if the cost cannot be justified, then offer some form of compensation for cancelling the ticket (in addition to the full refund). Yes, a full refund is a minimum, I would also offer a voucher for a future flight as compensation for cancelling the ticket. Of course there is no obligation for airlines to offer such compensation, but I think that it is a good compromise and will probably help avoid some legal action in certain situations.