The Biden administration said Thursday it will take steps toward requiring airlines to pay cash compensation and cover lodging and meals for passengers who are stranded when an airline causes flights to be canceled or changed.
Such a rule would go far beyond the current requirement for airlines to pay ticket refunds. It would make U.S. policy more closely resemble airline consumer protections in Europe.
But with less than seven weeks until President Joe Biden leaves office, the fate of additional regulations on airlines will be left in the hands of President-elect Donald Trump's administration.
The industry trade group Airlines for America said the Biden administration's proposal would drive up ticket prices.
“In this highly competitive industry, carriers don’t need further incentive to provide quality service,” the group said in a statement. “This proposal is simply one in a long string of ill-conceived and rushed rules from an administration intent on reregulating the U.S. airline industry.”
Biden's Transportation Department said it will seek public comment on requiring airlines to pay cash compensation — starting at $200 — when a flight is canceled or significantly delayed because of a mechanical problem with the plane or an airline computer outage.
Transportation Secretary Pete Buttigieg said his department is considering new passenger protections at this late date because air travel is breaking records.
The Transportation Department runs an online “dashboard” that lists each airline's promise around customer service when they cause flights to be canceled or severely late. However, passengers must usually ask for help at the airport, and airline promises don't carry the weight of federal rules.
The department said it is considering cash compensation that could go as high as $775 for delays of nine hours or more. The agency is considering letting small airlines pay less compensation than large ones.
The proposal will likely include free rebooking on the next available flight, possibly on another airline, and meals and lodging when passengers are stranded overnight. Many of the largest U.S. airlines already promise that kind of help when a delay or cancellation is their fault.
The administration will seek public comment on how to distinguish cancellations or delays that are within an airline’s control with those that are not.
Buttigieg said Thursday that a compensation rule would discourage airlines from causing delays and make them take care of passengers when problems occur.
Buttigieg said on MSNBC that protections for airline consumers enjoy bipartisan support in Congress — that was on display this week during a Senate hearing on airline fees — and that Trump campaigned on populist themes.
“One important test of that will be to see if the next administration follows through on what we have initiated and maintains the rules that we have created and the enforcement practices that we have created to hold airlines accountable,” he said.