Biden administration enforces stricter consumer protections on airlines

President Joe Biden‘s administration is trying to ensure airlines offer automatic cash refunds to passengers and protect consumers, more broadly, from surprise fees, according to Transportation Secretary Pete Buttigieg.

“Passengers deserve to know upfront what costs they are facing and should get their money back when an airline owes them — without having to ask,” Buttigieg said Wednesday in a statement. “Today’s announcements will require airlines to both provide passengers better information about costs before ticket purchase, and promptly provide cash refunds to passengers when they are owed — not only saving passengers time and money, but also preventing headaches.”

The Biden administration is attempting to enact the changes through two federal regulations, according to the Department of Transportation. The first rule, finalized Wednesday, requires that airlines fully refund passengers when owed automatically and with cash or the original form of payment if their flights are canceled or significantly affected, their checked bags are significantly delayed, or there are problems with purchased services or products, such as in-flight Wi-Fi.

A second rule requires airlines and ticket agents to advise consumers proactively of the fees they charge for baggage and changing or canceling reservations when prices are first advertised and not through a hyperlink, as well as inform them of any terms and conditions.

“When offering an advance seat assignment for a fee, airlines and ticket agents must let consumers know that purchasing a seat is not necessary to travel, so consumers can avoid paying unwanted seat selection fees,” DOT wrote in a fact sheet.

The measures are part of an administrationwide endeavor to reduce consumer prices amid persistent inflation. Buttigieg has also routinely intervened in the airline industry, particularly amid chaotic post-pandemic travel, returning $600 million to passengers after the 2022 Southwest Airlines holiday meltdown and fining airlines more than $164 million for consumer protection violations.

The automatic refunds rule will be implemented over the next six months to a year, while the latter fees rule over the next six months to two years.

The Biden administration is also proposing to prohibit family-seating junk fees, introduce mandatory compensation and amenities, and expand disability access, though those rules have not been finalized.

The rules, unlikely to be welcomed by the airlines, may be challenged in court. But during a separate press conference at Ronald Reagan Washington National Airport, Buttigieg said he and the administration are “confident in the sound legal basis.”

“Unsurprisingly, airlines are not enthusiastic about us holding them to a higher standard,” Buttigieg told reporters. “I believe that this is in the interest of the airline sector because it builds passengers’ confidence in airlines. … They’ll be able to adapt to this.”

Airlines for America, a trade association and lobbying group that represents major North American airlines, said its member airlines already offered transparent pricing and choices to consumers and would continue to do so.

“A4A passenger airlines — which are fierce competitors — offer transparency and vast choice to consumers from first search to touchdown,” A4A said in a statement to the Washington Examiner Wednesday morning.

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“A4A members offer a range of options — including fully refundable fares — to increase accessibility to air travel and to help customers make ticket selections that best fit their needs. Consumers are given the choice of refundable ticket options with terms and conditions that best fit their needs at first search results,” A4A said. “U.S. airlines are providing more options and better services while ticket prices, including ancillary revenues, are at historic lows.”

The 11-largest U.S. passenger airlines issued $43 billion in refunds to customers between January 2020 and December 2023, according to A4A. The cost of an average round-trip flight was 14% lower in 2023 than in 2010.