Transportation Dept. warns airlines they must refund passengers on flights canceled over coronavirus

Transportation Dept. warns airlines they must refund passengers on flights canceled over coronavirus
© Greg Nash

The Department of Transportation (DOT) issued a warning to airlines Friday telling them they must refund passengers for flights canceled due to the coronavirus pandemic.

DOT said it has received an influx of complaints from passengers whose nonrefundable tickets were completely canceled or significantly delayed after airlines saw a sudden drop in passengers as public health officials began issuing travel advisories in March. The notice said DOT will refrain from enforcing the notice so long as airlines make refunds to affected customers in a timely fashion.

“Because the COVID-19 public health emergency has had an unprecedented impact on air travel, DOT’s Aviation Enforcement Office will exercise its enforcement discretion and provide carriers with an opportunity to become compliant before taking further action,” the warning said.

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On Tuesday, nine Democratic senators called on domestic airline carriers to provide cash reimbursements for canceled flights, noting “Americans need money now to pay for basic necessities, not temporary credits towards future travel."

Officials noted that airlines were compliant with such standards during other crises that led to a reduction in air travel, such as Hurricane Katrina and the Sept. 11, 2001, attacks.

However, airlines have repeatedly said that the sudden loss in sales they've seen in the past month is unprecedented. 

Though airlines were allocated $25 billion in bailouts in the $2.2 trillion stimulus bill passed last week, Delta said in a Friday memo that “those funds alone are not nearly enough,” adding they project their revenues in the second quarter will drop 90 percent.

Most major airlines are expected to get a cut of the $25 billion in federal grants, though the money comes under the condition that they don’t lay off or furlough employees, which some have committed to. 

United Airlines executives said last week they’ve cut their April schedule by more than 60 percent and expect planes to fly at less than 20 percent capacity or in the single digits in some cases.