Hacker News Reader

Comment by vannevar | Hacker News Reader

There's a much simpler solution to the overbooking problem: eliminate the fraud exemption that airlines currently enjoy, allowing them to sell the same seat twice.

The downside is that, if airlines are unable to resell unused seats, more flights will fly partially empty, reducing overall efficiency of the industry. But if they offer standby "tickets" at steep discounts (instead of making every ticket a probabilistic standby seat), that problem would solve itself.

View on HN

They could just ask every passenger how much they would want to potentially take the next plane. Then just bump those that ask the least. If I’m choosing between the 1pm and 3pm place and decide on 1pm I’m obviously not that opposed to changing to the 3pm, so I’d enter a low sum. But if I’m going to an important event or connecting to another flight then my cost of switching might be huge.

But I doubt any of this will change, anyone who buys a cheap ticket isn’t buying a “seat” they are buying a chance at a seat. The alternative as you say is lower efficiency and higher prices for everyone.

The incident where a passenger was dragged off shouldn’t be possible regardless of system since the bounced passenger should never be boarded.

Your solution means higher ticket prices overall, which consumers have repeatedly indicated they do not want. Most people don’t get bumped from flights. Most people don’t want to pay x% more to see their family once a year.

The percentage increase in price shouldn't be any greater than the percentage probability of getting bumped from a flight, which as you point out, is relatively low. If every hundredth seat is overbooked on average, then you've got 101 passengers for 100 seats. If they all paid $100, then you could offset the lost revenue from the 101st passenger by charging the remaining passengers $101 each. Not exactly a game changing cost increase.

This is absolutely wrong, as many passengers do not make it to a flight, without being bumped. This rate is very high and makes overbooking valuable. The difference in cost includes both the relatively low bumping rate and the relatively high missed/cancelled flight rate. Many routes make very little revenue per flight (not per passenger) after overhead - at times in the hundreds of dollars, if I recall correctly - and would be completely unviable without overbooking.

This is absolutely wrong, as many passengers do not make it to a flight, without being bumped.

Based on personal experience, I doubt this is true. Ask yourself how many times have you done this? I've flown hundreds of times, but have only missed a handful of flights. So the collision rate should be very close to the actual overbooking rate.

I haven't been able to find any figures on the actual rate of overbooking. But I did see a statement that 11% of bumps are involuntary. And the overall rate for involuntary denial is 0.09% according to this article, for instance: https://www.ft.com/content/e4cb5744-1e9d-11e7-a454-ab0442897....

That suggests that the overall rate of overbooking collisions is around 0.9%, which is close to my overbooking estimate of 1%. Even if I'm off by an order of magnitude, the impact on fares would be no more than 10%.

You're just assuming overbooking away on a single, personal anecdote. Here's mine: I fly a lot on flexible tickets, and in periods have "missed" almost every flight I was scheduled on. But even your experience works out to about 1% missed flights (order of magnitude on "handful"/"hundreds"). If that pans out as average, then airlines should overbook each flight by a couple of seats, and expect to have to bump very few. "Just not overbooking" then amounts to removing a couple of seats from every flight. Only focusing on bumping completely misses this aspect.

Not an anecdote, just a reasonable assumption in the face of a lack of actual data. With your full fare tickets, you say that there have been "periods" where you missed a lot of flights. How many overall? One in a hundred? One in ten flights you've ever booked? I suspect that if you add them all up, you'll find that your experience is not that far from mine. We tend to recall aberrations better than the routine outcome.

Eliminating the fraud exemption for airlines wouldn't necessarily mean removing seats; as I pointed out, the seats could be filled with discounted standbys.

Lots of other businesses sell seats without overbooking, I hardly think it's an unsolvable problem. Airlines got a fraud exemption because they could, not because it was the only solution to the problem.

Overbooking != Bumped passengers

Most of the time, by a large margin, all of the passengers who show up for a flight get on it. That's the premise for overbooking, for any given flight, some number of passengers don't show up (including for reasons like missed connections, which the airline still have to fix).

Sometimes, though rarely in the grand scheme of things, too many passengers do show up, and bumping is necessary. In the vast majority of those cases, someone volunteers for compensation.

It's also important to keep in mind that the Dr Dao incident wasn't caused by overbooking, at least not as commonly understood. The airline urgently needed to reposition a crew to allow another flight to operate, and decided that this need trumped the passengers.

Indeed. See my reply to @tetrazine below: it appears that 90% of bumps are voluntary. But per my original comment, the rate of overbooking is quite low, and legally eliminating it should not have a big impact on fares.

>"The downside is that, if airlines are unable to resell unused seats, more flights will fly partially empty, reducing overall efficiency of the industry"

You are talking about load factor and its not so much an issue any more. See:

http://atwonline.com/airline-traffic/top-30-airlines-passeng...

Part of the reason those load factors are so high is that airlines are allowed to oversell capacity, to help ensure that as many seats as possible are occupied.

Interesting my understanding was that they were influencing load factor simply by scaling back the number of flights per day on a certain routes. Might you have any links?

I imagine as someone else also pointed out that this venture being discussed here will ultimately used to oversell even more.

Don't all airlines already sell standby tickets? I'm guessing the demand on the average flight isn't enough to cover the chance someone won't show.

If demand were too low for standby tickets, the flight wouldn't be in danger of overbooking in the first place.

I've never seen standby tickets on sale in a first order way. Usually, it's when you're on a rebooked or connecting flight, they'll offer you standby on a better (but sold out) option.

Reply on news.ycombinator.com