Air Travel Disruptions and DOT Aviation Consumer Protection Rules
INSIGHTi
Air Travel Disruptions and DOT Aviation
Consumer Protection Rules
July 25, 2024
On Friday, July 19, 2024, a faulty software update for the Windows operating system from cybersecurity
firm CrowdStrike led to outages that disrupted multiple business sectors around the world, including
airlines, banks, and health care, as well as government and emergency services.
The technology outage appeared to have hit airlines especially hard, forcing Delta Air Lines, American
Airlines, United Airlines, Allegiant Air, and Spirit Airlines to ground flights in the United States, which
led to thousands of flight cancellations, extensive delays, and long waits at airports on Friday and over the
subsequent weekend. Flight tracking website FlightAware indicated that between July 19 and July 21,
more than 7,500 flights within, to, or from the United States were canceled, and 32,500 flights were
delayed, as reported by Aviation Daily on July 23, 2024.
The large number of flights and passengers affected is reminiscent of the Southwest Airlines service
meltdown between December 21 and December 29, 2022, which was initially caused by winter storms
and compounded by an internal breakdown of the crew-scheduling system. This led to over 16,700 flight
cancellations, affecting over two million passengers. Congressional hearings, a Department of
Transportation (DOT) investigation, and a subsequent $140 million fine against Southwest was part of the
federal response to this incident.
While most airlines appeared to have recovered from service disruptions and restored operations after the
weekend, Delta Air Lines continued cancelling significant numbers of flights. Delta reportedly has
canceled more than 5,500 flights since the start of the Friday outage, including at least 700 flights
canceled on Monday, July 22, 2024, accounting for about two-thirds of all cancellations worldwide that
day. As of July 24, 2024, Delta announced, “[a] travel waiver, which offers customers the ability to make
a one-time change to their itinerary, or to cancel and receive a refund for the unflown portion of their
ticket upon request, is in effect for customers with travel scheduled for July 19-28. The fare difference
will be waived when rebooked travel occurs on or before August 4, in the same cabin of service as
originally booked.”
On July 23, 2024, Senator Maria Cantwell, chair of the Senate Committee on Commerce, Science, and
Transportation, sent a letter to Delta regarding the airline’s operational and customer communications
problems in the wake of Friday’s outage. DOT announced on the same day that it was launching an
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investigation into Delta’s widespread flight disruptions and customer service failures, drawing further
attention to DOT aviation consumer protection rules.
The rights of domestic airline passengers are set forth at three different levels: in federal statute, in
regulation, and in airlines’ policies known as “contract of carriage.”
The 1978 economic deregulation of the U.S. airline industry eliminated federal control over many airline
business practices, including ticket price and domestic route selection. However, the federal government
continues to legislate and enforce certain consumer protections for airline passengers. The House
Committee on Transportation and Infrastructure and the Senate Committee on Commerce, Science, and
Transportation are the primary congressional committees of jurisdiction over airline passenger rights.
Congress can authorize DOT to establish and enforce certain consumer rules on certain issues, and it can
enact requirements for airlines through direct legislation. In specific cases, DOT can take enforcement
actions against airlines that violate consumer protection rules.
Most of DOT’s consumer protection rules are authorized by 49 U.S.C. §41712, which directs the agency
to “protect consumers from unfair or deceptive practices.” Some rules are also empowered by DOT’s
authority to require air carriers in interstate transportation to provide “safe and adequate service” (49
U.S.C. §41702). The definition and interpretation of “unfair or deceptive” can affect the scope of DOT’s
rulemaking and enforcement authority. DOT’s current aviation consumer protection rules (14 C.F.R. Part
259, Enhanced Protections for Airline Passengers) include the airline ticket refunds final rule issued on
April 24, 2024, that clarified the definitions of “cancelled flight” and “significant change.” The rule
codified that it is an unfair business practice to refuse to provide timely refunds when a carrier has
cancelled or made a significant change to a scheduled flight, and consumers deemed the alternative
transportation offered to be unacceptable. A few major requirements in this final rule include the
following:
• Automatic refunds to consumers when airlines cancel or make a significant change to a
scheduled flight, and the consumer is not offered or rejects alternative transportation and
travel credits, vouchers, or other compensation.
• These refunds must be provided promptly (i.e., within seven business days for credit card
payments and within 20 calendar days for other forms of payment).
• Refunding fees to consumers for ancillary services that passengers paid for but did not
receive, including for checked baggage if the bag is significantly delayed.
• Travel vouchers or credits that are transferrable and valid for at least five years from the
date of issuance to consumers who are unable to or advised not to travel as scheduled
because of a serious communicable disease.
The airline ticket refund requirements and other aviation consumer protection provisions were included in
the FAA Reauthorization Act of 2024 (P.L. 118-63, enacted on May 16, 2024) Title V, Passenger
Experience Improvements.
As federal agencies and lawmakers investigate airline service disruptions triggered by technology outages
such as the one caused by the CrowdStrike faulty update and consider policies to deter such incidents and
mitigate the impact on customers in the future, they may consider several issues that may not be in the
conventional federal oversight scope, including the following:
• If and to what extent airlines are responsible or accountable for incidents (besides
weather) that may be outside of their control.
• If and to what extent airline information technology system security and resilience could
be included in the airline fitness assessment when DOT determines whether the airline
applicant is “fit, willing, and able” to conduct commercial airline operations.
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•
• Whether or not to require airlines to develop contingency plans addressing service
disruptions from computer system outages as a part of the customer service plans
required by 14 C.F.R. 259.5.
Author Information
Rachel Y. Tang
Analyst in Transportation and Industry
Disclaimer
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