I can’t decide what is worse, the downgrade from business class to economy class itself or the gall of KLM only offering such paltry compensation for the involuntary downgrade.
KLM Downgrades Couple On Pricey Business Class Tickets, Initially Offers Them Offensively Low Travel Vouchers
A couple were traveling from Miami (MIA) to Kilimanjaro, Tanzania (JRO) for a safari and booked business class tickets on KLM via Amsterdam (AMS) for $10,661 per person via a travel agent. On the morning of travel, despite already having checked in and received their business class boarding passes, the couple received an email from KLM informing them they would be downgraded to economy class on the Miami to Amsterdam flight due to an equipment change.
The whole point of booking business class was to secure a lie-flat bed on the overnight transatlantic flight (the connection was a daytime flight), but the couple flew in economy class–row 34–because they really did not have another choice. The other three legs remained in business class.
Upon their return, they filed a claim with KLM and were offered a paltry $924 travel voucher per-person, despite both EU and US law requiring cash compensation for involuntary downgrades.
The couple reached out to consumer advocate Christopher Elliott, who helped to secure more meaningful cash compensation from KLM.
“I wanted you to know that we’re receiving a refund of $4,051 from KLM. While it’s less than what we’d hoped for, it’s in line with the EU regs requiring a 75 percent refund if we look at this segment as one-quarter of our itinerary. We are extraordinarily grateful for your help. You perform an important consumer service.”
An interesting side note, though it has little to do with the story, is that the two travelers were none other than John and Fran Edwardson. John was the President and Chief Operating Officer at United Airlines. Meanwhile, Fran Edwardson was both the Senior Vice President and General Counsel at United. Quite a power couple in the airline industry!
For people like this, the cost of the ticket (it does seem there is a published D fare about this price, though tickets can be had for 1/3 of that) is probably far more immaterial than the comfort of having a lie-flat bed. But when you have to get to your safari, what are you going to do?
As for KLM, the carrier shows it is just another airline that tries to dodge its obligations and acts in poor faith. I find absolutely no valid excuse to skirt both EU and US regulations by offering such a trivial compensation amount and in the form of a voucher, not cash.
Examples like this make me more likely to support new regulations requiring airlines to proactively issue compensation in the case of cancellations, delays, and downgrades.
CONCLUSION
When an airline downgrades you, compensation should be rapid and not require many rounds of back-and-forth to secure. Regulations do not spring out of a vacuum but often arrive because airlines do not do the right thing in a “free market” system. Here we have another indefensible case of an airline trying to worm out of honoring its end of the contract. $4,051 may not make them whole, but it is a far better resolution than simply offering a paltry travel voucher.
Hat Tip: One Mile At A Time
The mode of op nowadays is go ahead & screw people as much as you can, the majority don’t have the know-how or resources to pursue a restitution. In the few scenarios when caught with your pants down then suddenly you are well aware of the regulations that ascertain your liability, not a penny more you give out . But what can you say businesses models politics.
Yes. And it’s why I favor a punitive penalty be charged to the airline and payable to impacted passengers when an airline goes cheap, slow or otherwise wrong on complying with regulations.
Big business can not be trusted to do the right thing by consumers in the absence of legal and regulatory switches with which to get them to behave better.
Over & above the loss (difference of money paid between the 2 class seats, there should be hardship compensation for suffering of NOT having a flat bed to rest on!
It’s telling that a UA power couple would rather fly KL over UA and its star alliance partners!
The safari-booking travel agency may have booked the air travel for them.
KLM works better for Miami-Europe-Africa safari-bound travel than United from Miami.
Yes, United would have been too much trouble. I’d imagine that flying to Newark/Dlles and then to Dubai or Cape Town or J’berg would have been too much trouble versus a nice easy MIA-AMS-JRO trip.
I’m a loyal United (more like Star Alliance) flier and I’ll be flying KLM LAX to AMS to JRO for a safari next month. KLM and Air France have the best routes to Tanzania for safaris (Qatar and Emirates work too, but flights are a bit longer).
Not many airlines fly long distance into JRO, although KLM has plied the AMS-JRO route for many years.
The downgrade was on the MIA-AMS segment meaning a quarter of the total flight. That’s would be $2665 per person or $5330 for two. 75% EU compensation is $3998 rounded so it’s not unreasonable they got down to. It’s still a bit embarrassing on KLM’s end or they valued MIA-AMS leg at its cheapest value which can go down to a bit over 2k and valued the difference to be $924.
That exact itinerary is usually around 6k per person though and there’s usually good deals that occur that drop it down to 4.2k per person in J. I’m guessing this was a last minute trip or something that made it worth 10k.
So why would he involve Elliott (who is fairly worthless) rather than pick up the phone and call his counterpart at KLM?
Speaking for myself, not quite a CEO, but been airline management for my career… plenty of times I could pick up the phone and get a resolution that may or may not be within the policy (I’ve gotten refunds on non-refundable tickets from ULCCs, changes of routings that the website said weren’t possible, etc). Or attempt it as a normal customer. Because quite honestly a normal customer shouldn’t have that much difficulty getting their legally entitled refund.
The guy was next in line to be CEO during the heady late 90s at United. Left on his own accord to please the unions before things went south.
I’m baffled they don’t have positive space biz class privileges on United to at least get them to Europe or DXB for a trip like this. Or is that the kind of thing wiped out in bankruptcy?
Either way probably would have been cheaper to rebook even last minute on another carrier, but guess they didn’t buffer in extra time to get there and be rested. Odd again for a retired couple, but who knows what else is going on. It’s all a bit odd for such seasoned travelers, executives and legal counsel.
And shame on the travel agent for not getting this sorted after the fact
I know them personally. They do have that ability on United, but United doesnt go to Tanzania. This was the quickest and most direct route from where they live in South Florida to their final destination.
I hope it was because of Karma and the negative experiences regular flyers had to endure. Remember there was a time when United had a commercial where the boss made everyone wait in the conference room and then intentionally showed up late?
I appreciated this story, though am puzzled by your seemingly off-topic throw-in about the “free market”.
Firstly, bad behavior and weasling out of responsibility is human nature and supersedes any economic system. You think people don’t do this in other systems? They do. In fact, in our system, the average person has far MORE recourse to get it resolved, not less.
Secondly, there’s hardly anywhere in the world where airlines operate in a free market. Even in the US, there are so many artificial constraints to true competition, that it’s actually an oligopolistic market, not a free market.
If we had a real free market, then we’d see much more competition, lower prices, and more effort by companies to win and keep passengers. What we see now is backroom deals to secure minimal competition, and a never-ending series of actions by the big players to improve profits, suck more revenue from passengers, with less and less concern about public blowback. I mean, what other choice do they have?
I used to buy that…your opinion once directly mirrored mine.
And you’re quite right that we don’t have a true free market system.
Furthermore, I never argued that other systems are necessarily better.
But the government can and should condition service (a privilege) using shared infrastructure (taxpayer paid) on a minimum level service, including fairly refunding for flights that are delayed, canceled, or downgraded. Forcing people to go to court over contractual claims is not the most efficient path when airlines want to leach off government-funded infrastructure and systems.
The damage has been done, unfortunately, as the DoJ (??) has allowed merger after merger in the USA for many years. The result is level of concentration (at airport level) that we just don’t see in Europe.
The airlines don’t want to leach off government funded infrastructure but they are forced to by the government. It’s like when people say who you would call if you had an issue. The answer is the police but only because they can criminalize you if you don’t use their services (failure to report a crime). There are a lot of people who would have no problem forming companies and systems that are fair to both shareholders and passengers but the government bans them from trying. JSX comes to mind.
The parties that should carry more weight are credit card issuing bank companies and networks. They can force the airlines into properly ascribing the value for each segment to refund. It might be more effective for the public to push credit card companies to use their role to hold airlines accountable as airliners are completely dependent on the credit cards.
Elliot is pulling his grift? Damn figured he went away years ago when they stopped publishing newspapers. For every legit case he worked on like this one, he picked others that shouldn’t have had a case because they were headline grabbers and made a good story. But because of him being involved the airlines and others gave in. And of course odds were he was getting a backend cut of the money.
Now we call it clickbait, but a wise man told us that’s what pays the bills.
Interesting that you, Dave, seem to not care for consumer advocates that help people get their money back when corporate bad behavior is exposed.
I wonder if Mr. Elliot has in the past presented your company in a bad light?
This very clearly illustrates how badly we need more regulations with teeth. If an airline was forced to triple the payment when they try to avoid the correct initial payout then there would be much fewer of these situations.
I will say that KLM misconnected a coworker of mine a couple of months ago and covered hotel, a small amount for food, and paid 400 Euros each for not getting her and her boyfriend back to the USA on the right date. The payment was made quickly and without fuss.
Sounds like they need a new travel agent. Any agent explaining they need to pay $10K each for a mixed class ticket to Africa is either an idiot or a scammer. Of course, I will also say that any former airline executive that thinks they need to pay that absurd amount is a a fool. And then there was KLM, the circle of idiocy completed.
Exactly, I doubt this was a last minute reservation and/or a fully flexible ticket (certainly doesn’t sound like it could be endorsed to another airline)- assuming my hunch is correct, there’s just no excuse for paying that amount of money.
It’s also worth noting that 261 rules don’t apply to journeys between non-EU countries, regardless of whether they include flights on an EU carrier and/or via a Union member state. I haven’t got a clue about how US consumer law works, but European consumer rights provisions do include stipulations on the fitness for purpose and/or quality of services delivered to consumers and airline passengers can use them to claim compensation.
It occurred on a flight to Amsterdam…where do you see that EU261 doesn’t apply just because there is a connection outside the EU.
In the eyes of the Regulation, it didn’t occur on a flight to Amsterdam, but on a journey from the USA to JRO. I can’t remember the exact bit of the statute off the top of my head, but there’s a handy summary here: https://www.airhelp.com/en-gb/eu-261-compensation/
By the way, this logic can also work to the benefit of the passenger: when I got a ticket to fly Avianca from MAD to GIG and the flight to BOG arrived just 1.5 hour late but only a couple of minutes before the boarding gate for my connecting flight to Brazil closed, I was entitled to €600 for arriving at my destination 24 hours later than scheduled (in the event, I only got my hotel paid for as they didn’t respond to my requests for compensation and I then got the dates mixed up and failed to sue them in time!).
I got so many €600-equivalent in payments from SAS for SAS not getting me into ORD on time to claim luggage at ORD and make my onward domestic US flights on United from ORD that even when I didn’t need to check-in luggage and was indifferent to staying in Chicago or at my ticket’s final destination, I have been booking an onward domestic and checking in luggage in hopes of missing the onward domestic connection on United.
Things like this will never end in the US. How many seats in Congress are competitive… 20, maybe 25. What are those people going to run on? Airline Compensation? Unlikely. Issues that don’t actually matter are more important to voters.
As long as people can keep their seats in Congress and keep getting money from airlines, what incentive would any legislator have to regulate bad behavior. Legislation isn’t created to help constituents, it’s made to reward donors.
Alternative headline: Airline executives get a taste of their own medicine.
Eff them! United did the same thing to me and my wife on our honeymoon. They gave us $400
Airline responsibility for delays, downgrading, overbooking in the US it’s a joke. Insulting compensation offers, rescheduling 8 times over 6-8 hours. The more you fly the more you see it. Unfortunately, 3 major airlines in 300 million country + budget substitutions.
No real competition = expensive tickets and low quality service
Do you think they would have been downgraded if they had elite status with KLM/Flying Blue?
Probably not, depending on ticket type and if the status was from the AF-KL program itself rather than a partner airline program. But if they were on a bulk fare ticket, all bets are off as KLM too is also part of the “you are your fare this time” mentality.
But given the fare amount mentioned, if they had some kind of ticket reissue due to a schedule change or flight misconnection, that would increase the odds of being messed up by the airline. But this time it was an equipment change that hit.
My job was to put in for the refund for the downgrades. I always warned my customers it would NOT be the refund they were expecting. These refunds are so little but this one takes the cake.
Regulations are useless if they arent enforced.