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Sat, Aug 23, 2003 - Page 12 News List

Airlines scrap no-refund tickets

FULL VALUE Although travelers' anecdotes often describe airlines as unresponsive to their concerns, few will complain about the rollback of the 'use-it-or-lose-it' policy


Travelers often say that the big airlines are as responsive to their complaints as a block of concrete. But this week, some airlines are rolling back to a degree a stringent use-it-or-lose-it policy on nonrefundable tickets that they put in place last fall to nudge business travelers toward buying higher-priced refundable tickets.

On Tuesday, American Airlines, the world's largest carrier, said it would allow a passenger to apply the full value of a nonrefundable ticket to a future ticket if the passenger called in to cancel a flight before the plane's departure. The passenger will have one year from the date the original ticket was issued to apply the value of the ticket to the new flight. The passenger will also have to pay a change fee that usually amounts to US$100 for domestic flights and up to US$200 for international flights.

Continental Airlines followed American's lead on Wednesday. Delta Air Lines said Thursday that it was also adopting the policy. Northwest Airlines went one step further and said Thursday that travelers could still keep the value of their original ticket for a year from the departure date even if they did not call in advance to cancel a flight.

The new policy is more generous than one that the airlines had put in place in the fall of last year. Under those rules, passengers canceling a flight had to book a new flight by the departure date of their original flight or they lost the value of the ticket.

Except for Northwest, the policy being adopted this week is not nearly as consumer-friendly as one that was in place before the fall of last year. Under the old rule, passengers could retain the value of their nonrefundable ticket for a year even if they did not call in to cancel a flight.

When the airlines went from that lenient policy to the hard-edged one, they were flooded with complaints, especially from business travelers.

Tim Wagner, a spokesman for American Airlines, a unit of the AMR Corp, said the company received complaints "frequently." He said passengers canceling flights often did not know when they would travel next and chafed at the fact that they were required to book another flight before the original departure date.

As of mid-afternoon Thursday, two major airlines had not followed American, Continental, Northwest and Delta. The holdouts were US Airways, the carrier that first announced the use-it-or-lose-it policy, and its code-sharing partner, United Airlines, a unit of UAL, which said it had no plans to match the new refund policies.

Last August, the same month it filed for bankruptcy protection, US Airways said it was imposing the stringent policy on tickets for travel starting in the fall. The other major hub-and-spoke airlines quickly matched its move.

During the economic slump, business travelers have been turning away from buying expensive, last-minute tickets and gravitating toward nonrefundable tickets with greater restrictions and change fees.

The imposition of the tougher policies last fall was intended to discourage business travelers from buying the cheaper tickets, though there are no signs that has worked.

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