The U.S. Department of Transportation (DOT) has launched an investigation into airline loyalty programs, focusing on transparency and fairness in rewards systems. This probe, announced on October 10, 2023, involves major airlines including Delta, United, and American Airlines. The investigation comes in response to a significant increase in consumer complaints regarding the value of points and rewards offered by these programs. The DOT aims to ensure that consumers receive fair treatment and clarity in how loyalty programs operate, addressing concerns that have been raised by travelers across the country.
Passengers in the United States have expressed growing dissatisfaction with air travel conditions, according to data from the Department of Transportation. The department received nearly 97,000 complaints in 2023, an increase from about 86,000 the previous year. This rise in complaints occurred despite a decrease in the number of flight cancellations by US airlines, with only 1.2 percent of flights cancelled in 2023 compared to 2.3 percent in 2022. However, flight delays remained high at around 21 percent. The majority of complaints were related to US airlines, while a quarter of the complaints were about foreign airlines. Complaints regarding the treatment of passengers with disabilities increased by over one-fourth compared to 2022, and there was also a significant rise in complaints of discrimination. The Department of Transportation is in the process of modernizing its complaint-taking system to better monitor the airline industry.
In India, domestic airlines have cancelled 7,030 scheduled flights until May this year, according to the Civil Aviation Ministry. The number of flight cancellations has been increasing, with 6,413 flights cancelled in 2022 and 7,427 in 2023. The Minister of State for Civil Aviation, Murlidhar Mohol, provided this information in a written reply. Despite the cancellations, airlines are expected to operate 4,56,919 scheduled departures in 2024. The Civil Aviation Ministry is planning a phased introduction of Digi Yatra, a system that uses Facial Recognition Technology for contactless and seamless movement of passengers at airport checkpoints. Over 2.5 crore air travelers have utilized Digi Yatra since its launch. The passenger data is encrypted and stored in the passenger's smartphone wallet and shared only for a limited time duration with the origin airport. The data is purged from the system after 24 hours of the flight's departure.
Direct flights between China and the United States are flying with less than full passenger loads due to various factors. The average passenger load on international flights was 85% as of June, while passenger loads on direct China-US flights have reached 75% this summer. The frequency of flights between China and the US in July was only 23.6% of what it was in July 2019, with seat occupancy at 25%. The decline in demand is attributed to difficulties in obtaining visas, a preference for cheaper and more circuitous routes, and a decrease in business travel due to the US-China trade war. The US has fallen to 13th place on China's list of top international markets. Chinese airlines are limited in the number of flights they can operate between the two countries, and US airlines have expressed concerns about unfair advantages for Chinese airlines. Despite the challenges, airlines are reluctant to provide more flights due to worries about low loads, but flights could increase as geopolitical situations improve.
Chinese companies are gaining market positions in the air transportation industry, squeezing American and British airlines. Chinese carriers have restored 90% of their routes after the pandemic, while Western airlines have only reached 60% of pre-pandemic levels. Chinese airlines have a cost advantage of at least 30% due to flying over Russia, making travel from Europe to Asia faster. Western carriers are forced to abandon flights to Asia as they are economically unprofitable. American airlines are demanding restrictions on Chinese carriers to the US. American airlines are already suffering losses due to fuel prices, staff shortages, and problems with Boeing. Chinese companies are taking advantage of the turmoil in the West to dominate the market, similar to what happened with electric cars.
New data released by Airlines for America (A4A), a trade organization representing major U.S. airlines, shows that the U.S. passenger and cargo airlines employ over 1 million workers. The employment numbers include pilots, flight attendants, mechanics, and other airline staff. The data also reveals that the airline industry supports millions of additional jobs in related sectors. However, the COVID-19 pandemic has significantly impacted the airline industry, leading to job losses and financial challenges. The industry is hopeful for a recovery as travel demand gradually increases. The US airline industry now has a workforce of more than one million people, the highest number in the last 23 years, according to Airlines for America (A4A). Air transportation employees earn 39% more than average private sector workers and receive benefits such as medical, flight, and retirement benefits. The airline industry supports 10 million jobs and drives 5% of the US GDP. Globally, airlines are hiring workers across various departments as air travel demand increases.
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