auc report on passenger survey - Air Transport Users Council

AUC REPORT ON PASSENGER SURVEY
Introduction
The Air Transport Users Council (AUC) is the Civil Aviation Authority’s air
passenger watchdog. In addition to handling individual complaints from passengers, it
represents the interests of passengers to regulators, parliamentarians and the industry.
In March this year, we commissioned Ipsos MORI to carry out consumer research to
get feedback from passengers in relation to issues of long-standing AUC interest. We
asked a sample of passengers to list up to five considerations (in order of importance)
when buying a ticket. We also asked about their experience in relation to a number of
specific issues. These were
• financial protection
• booking errors
• optional fees
• refund of taxes, fees and charges
• performance <strong>report</strong>ing.
We planned to use the findings of the research to inform AUC activity in relation to
these issues in the future. The research was intended to complement the intelligence
the AUC already receives from complaints and enquiries. Complaints give early
warning signals of the issues where the market may not be working for passengers
and where there is potential for significant consumer detriment. Consumer research
can give us complementary insights into passengers’ perspectives on these issues.
The results of the survey are attached to this <strong>report</strong>. The results for the questions about
specific issues are at annex 1. A table of the top ten mentions when respondents were
asked the list up to five considerations when booking a ticket are at annex 2.

2
Financial protection against scheduled airline failure
Key findings
• When we asked passengers to list up to five considerations (in order of
importance) when buying a ticket, only five respondents mentioned the chance
of an airline going bust (out of a total of 2072 respondents).
• 30% of respondents did not know if their last flight was financially protected
or not.
• 34% of respondents did not know if the last travel insurance policy they
purchased included financial protection.
• 71% of respondents agreed that it was important that travel arrangements were
financially protected (scoring at least 7 out of 10 in terms of importance).
• Only 8% of respondents would definitely not pay extra to be financially
protected when booking a flight.
• 49% of respondents said that their last flight was financially protected.
The results of the survey suggest that people generally do not consider financial
protection against the failure of a scheduled airline when they book a ticket. Only 5
out of 2072 people mentioned the chance of an airline going bust when asked to list
up to five considerations when booking a ticket. In addition, 30% of passengers did
not know if their last flight was protected and 34% did not know if their travel
insurance included protection. However, when asked, passengers generally thought it
was important that their flights were protected (table 1). Furthermore, 24% would
pay extra for financial protection, 36% would consider it while for a further 14% it
would depend on the cost (table 2).

3
Using a scale of 0 to 10, where 0 in not at all important and 10 is extremely important,
how important is it to you that your travel arrangements are financially protected by the
company you book through
2%3% 4% 15% 22% 11% 38% 6%
0 1 to 2 3 to 4 5 to 6 7 to 8 9 10 Don't know
Base: All respondents who have booked a flight in last 12 months (2,072) – March 2010
Table 1
Source: Ipsos MORI
When booking a flight, to what extent would you be prepared to pay extra for financial
protection, so that your travel arrangements are financially protected
Don’t know
Definitely would
Depends on the cost
14% 1% 5%
Probably would
19%
Definitely would not
8%
Probably would not
16%
36%
May or may not
Base: All respondents who have booked a flight in last 12 months (2,072) – March 2010
Table 2
Source: Ipsos MORI

4
For a number of years, we have called for government to introduce a financial
protection scheme against the failure of scheduled airlines similar to the ATOL
scheme for tour operators. We suggested that consumers’ general lack of
understanding of financial protection had made passengers increasingly vulnerable to
the impact of an airline’s failure. The results of the survey appear to bear out our
concerns. But when asked directly about protection, respondents said that they
thought it was important that they were protected and many said that they were
prepared to pay extra for it.
We think this is therefore yet more evidence of a need for some sort of universal
protection scheme against the failure of scheduled airlines. Protection should be
automatic and passengers should not be relied on to seek out their own cover through
their credit card or travel insurance. We plan to use this evidence as part of our
ongoing efforts to get government to mandate such a scheme.
Booking errors
Key findings
Mistake made by passenger
• Almost one in five respondents (17%) had made a mistake when booking a
ticket online.
• More than half of respondents (58%) who had made a mistake were out of
pocket to some extent with 9% having to buy a new ticket at full cost to them.
• The majority of respondents (65%) who had made a mistake found the process
of notifying an airline of their mistake to be either fairly, or very, easy.
Technical issue with airline reservation system
• 13% of respondents had experienced a technical issue when booking a ticket.
• Almost a third of respondents (29%) who had experienced a technical issue
were out of pocket to some extent even though it was not their fault, with 8%
having to buy a new ticket at full cost to them.
• 29% of those who had experienced a technical issue did not notify the airline
of the problem even though they were left out of pocket.
We receive a large number of complaints from passengers who have had problems
making a reservation. And often these passengers can be significantly out of pocket.
(They might have had to pay an administration fee to amend a reservation or even a
buy a new ticket. Or a glitch in the system might have meant the passenger had made
a duplicate booking.)

5
The results of the survey suggest that significant numbers of consumers may have
problems booking tickets online. 17% of respondents had made a mistake themselves
by entering the wrong information, whilst 13% had experienced a technical issue.
And, of these, a large percentage had been left out of pocket as a result.
They also suggest that the way airlines deal with such complaints may vary
considerably (tables 3 and 4) - some respondents were out of pocket even when the
problem was caused by technical glitches which might have been the airline’s fault.
The results perhaps suggest that technical glitches with airlines’ own reservations
systems are more widespread than airlines might like us to think.
The results corroborate the feedback we already have from our complaints data. We
have previously called for airlines to adopt a 24-hour rule which gives passengers the
chance to make changes or claim a refund (even if subject to a small administration
fee) if there is an error with their booking. We believe that such a rule would greatly
benefit passengers whilst not causing airlines to lose out financially. The survey
results show that a number of the respondents might have benefited from a 24-hour
rule. We will therefore use this feedback as evidence in our continuing work on this
issue.
How did they deal with the mistake
Made the change free of charge
36%
Made the change for an administration fee
32%
Made the change based on their normal reservation
change fees
15%
Was given a full refund and asked to book again
2%
Was given a part refund and asked to book again
2%
Was given no refund and had to book again at full cost
9%
Other
4%
Base: All respondents who have <strong>report</strong>ed a mistake (265) – March 2010
Table 3
Source: Ipsos MORI

6
How did they deal with the mistake
Made the change free of charge
44%
Made the change for an administration fee
6%
Made the change based on their normal reservation
change fees
Was given a full refund and asked to book again
12%
14%
Was given a part refund and asked to book again
3%
Was given no refund and had to book again at full cost
8%
Other
9%
Base: All respondents who have <strong>report</strong>ed a technical issue (180) – March 2010
Table 4
Source: Ipsos MORI
Optional fees
Key findings
• 16% of respondents had mistakenly paid for a service they did not want.
• Over half of those who had paid for an optional fee by mistake (53%) did not
get a refund when they pointed it out to the airline.
• Only about a third of respondents (37%) found optional fees clear and easy to
understand during the booking process.
A trend to emerge in the airline industry in the last few years has been the increase in
the number of fees for services that were previously included in the fare, such as for
checked-in baggage. The price increments for the extra services are displayed at
different stages of the booking process.
This practice may not necessarily be detrimental to consumer interests. It seems fair
for passengers to pay for services they use. But we have concerns that consumers may
not be aware of the price of optional services before starting the booking process.
They therefore do not receive a total price until well into the process and, as a result,
might not shop around to get the best deal. We also have concerns that some airlines
do not make it clear that the fees for some services are optional.

7
We believe that significant numbers of passengers might be affected. However, we
receive few complaints about optional fees. (This may be partly because the fees are
for such small amounts that the impact on consumers is not sufficient to prompt them
to contact us.) We therefore included questions about optional fees in our survey.
The results appear to confirm our concerns. Half of passengers (47%) considered that
optional fees were not presented in a clear and easy to understand manner during the
booking process (table 5). This suggests that passengers may find it difficult to
compare the optional fees between different airlines.
When booking a flight, to what extent do you agree or disagree that you find any
additional charges clear and easy to understand, before actually selecting your flights
Strongly disagree
15%
Don’t know
Strongly agree
1%
9%
28%
Tend to agree
Tend to disagree
31%
15%
Neither agree nor disagree
Base: All respondents who are aware of additional charges (1,958) – March 2010
Table 5
Source: Ipsos MORI
In addition, one in six (16%) consumers had mistakenly booked an optional service
that they did not require (table 6). And over half of these had not been able to get their
money back when they pointed this out to the airline. This includes most of the extra
services that airlines tend to charge for. Travel insurance and baggage fees have in the
past often been presented to passengers on an “opt-out” basis (though the Air Services
Regulation – see overleaf – outlaws this practice). This may account for why 6% and
4% respectively of respondents paid for this by mistake. In addition, it is sometimes
not clear from airline websites that seat allocation fees are avoidable - this might
account for the 4% who had booked this by mistake.

8
When booking a flight, have you ever mistakenly paid a fee for an optional additional
service, which you did not want
No / Don’t know
84%
Yes
16%
Travel insurance
Baggage to check in
Seat allocation
Additional baggage
Priority boarding
Other
6%
4%
4%
2%
2%
1%
Base: All respondents who are aware of additional charges (1,958) – March 2010
Table 6
Source: Ipsos MORI
Regulation (EC) 1008/2008 on “common rules for the operation of air services in the
Community” includes provisions on airline ticket pricing. It states that “optional price
supplements shall be communicated in a clear, transparent and unambiguous way at
the start of any booking process and their acceptance by the customer shall be on an
opt-in basis”. The survey results appear to suggest that at least some airlines do not
comply with this provision. We will use this feedback in our work on this issue in the
future.
Performance <strong>report</strong>ing
Key findings
• 63% of respondents said that performance league tables would influence their
decision on which airline to use by a great deal or fair amount.
• 84% of respondents tended to agree, or strongly agreed, that performance
league tables should be made generally available.
We believe that performance <strong>report</strong>ing is an incentive to underperforming airlines to
improve service quality. It also has a side effect of providing consumers with
information to help inform their choice of airline. We have previously published both
punctuality and baggage league tables based on data provided by other sources. We
have also called for the European Commission to legislate to force airlines to publish
service quality indicator <strong>report</strong>s. The results of the survey provide evidence of strong
public support for performance <strong>report</strong>ing.

9
Refund of taxes, fees and charges
Key findings
• 15% of respondents had cancelled a non-refundable ticket, with 45% of these
claiming a refund of taxes, fees and charges (TFCs).
• 57% of those who had claimed a refund for such a ticket were not able to get
any money back.
There are occasions when passengers, for whatever reason, have to cancel their
booking for a non-refundable ticket. Because airlines usually separate out TFCs from
the main fare on tickets and confirmation invoices, passengers often try to claim a
refund of the TFCs. Most airlines will agree to refund TFCs subject to administration
fees, usually for an amount more than that to be refunded, thus making the claim
redundant. We think this is unfair; if airlines insist on separating out TFCs on tickets
and confirmation invoices then passengers expect to be refunded for this part of the
fare should they decide to cancel their ticket.
The results of the survey suggest that a significant number of passengers cancel
non-refundable tickets and try to claim a refund. But they also suggest that a majority
of the respondents are unable to get any money back. We have previously called for
an end to this practice but many airlines continue to charge fees. We will use this
feedback to inform any future action we might take on this issue.
Environment
Key finding
• No mentions of the environmental impact of the aircraft in answer when
respondents were asked to list up to five considerations when booking a ticket.
There has been a drive in recent years to inform passengers about environmental
performance of airlines so that passengers can take this into account when choosing
which airline to fly with. With this in mind, many airlines now promote their aircraft
as being environmentally friendly in a bid to attract the more environmentally
conscious consumer. But the results suggest that the environmental impact of an
aircraft is far from a passenger’s mind when they are booking a ticket.
AUC
28 th July 2010