Biden, Buttigieg push for airlines to compensate passengers for controllable delays, cancellations

Just weeks before the start of the busy summer travel season, President Joe Biden and Transportation Secretary Pete Buttigieg announced a new process on Monday that seeks to provide relief for frustrated air travelers by requiring airlines to provide passengers with boosted compensation, including meals and hotels, if they are left stranded and it's the airline's fault.

In his remarks, Biden noted that he knows American air travelers have been left frustrated in recent years.

"I know how frustrated many of you are at the service you get from your U.S. airlines ... I get it. That's why our top priority has been to get American air travelers a better deal," Biden said.

"We know how frustrating delays, cancellations or make bookings are for travelers," Biden said. "Last holiday season, travelers were stranded for days and had to scramble to find other ways to reaching their destinations. Many missed family gatherings, spent Christmas at an airport, waited countless hours in line, or on the phone because there weren't enough pilots, there weren't enough personnel. That's unacceptable. And while flight delays and cancellations have come down since then, there's still a problem. American air travelers deserve better. And that's what we're going to do. That's what we're doing here today."

He pointed to two actions the administration is taking to help air travelers.

The administration will be launching an expanded website with a dashboard that hosts all the information about airlines and what compensation would be guaranteed. The website would note which airlines currently offer cash compensation, provide travel credits or vouchers, or award frequent flyer miles and cover the costs for other amenities.

The second action the administration will be taking later this year would allow for air travelers to be compensated not only for their flights but also for their meals, taxis, rideshares, and hotels if you're left stranded and the airline is at fault.

"Historically, when delays and cancellations are the airline's fault, the law has only required airlines to refund customers the price of their flight ticket, but not the cost of meals or hotels or transportation when you get left in limbo," Biden said.

"If your flight is very delayed or canceled, and the airline could have prevented that from -- you deserve more than just being -- getting the price of your ticket, you deserve. You deserve being fully compensated. Your time matters. The impact on your life matters," he said.

He noted this new rule should take affect "later this year."

But the airline industry is likely to resist.

"We can expect that the airlines' trade group will fight this proposal vigorously, citing the risk of higher fares and less competition," said industry analyst Henry Harteveldt Monday on a Zoom call.

A consequence of the proposal is that airfares may go up, especially for budget airlines like Spirit, Breeze and Allegiant, according to Harteveldt. The money for compensation needs to come from somewhere, he said.

“If the proposal comes out with compensation that is too expensive for the airlines, some airlines may have to raise their fares so much that some passengers may be priced out of the market,” said Harteveldt.