Hidden-city ticketing and the Streisand effect: a cautionary tale [Archive]

mixture

13th Jan 2015, 10:21

Oxford dictionary definition :

Wrongful or criminal deception intended to result in financial or personal gain

Wikipedia definition of hidden city :

Hidden city ticketing occurs when a passenger disembarks an indirect flight at the connection node. Flight fares are subject to market forces, and therefore do not necessarily correlate to the distance flown. As a result, a flight between point A to point C, with a connection node at point B, might be cheaper than a flight between point A and point B. It is then possible to purchase a flight ticket from point A to point C, disembark at the connection node (B) and discard the remaining segment (B to C).

Thus because hidden city ticketing has no use other than personal financial gain, a person would be effectively committing fraud, since they will be knowingly buying a ticket with the full intention at the time of purchase of discarding the segment.

Do it once and the airline might turn a blind eye, but make a habit of it and that's where the word fraud comes into play.

ExXB

13th Jan 2015, 11:51

Hidden City ticketing is specifically prohibited in UA's conditions of carriage. Passengers who book through UA's website agree that they will not use Hidden City ticketing.

Just about every other airline on the planet (that have through fares via connecting points) specifically prohibit the practice. Easyjet, Ryanair et al, don't prohibit it but who cares, you can't do it on a point to point airline.

The young man in question is counselling passengers to breach their contract terms with United airlines. That is what this case is about, not the validity of the prohibition.

If caught the passenger will be refused transport, again pursuent to the contract terms they have agreed.

The courts and consumer agencies have reviewed these rules (ad nausium) and have always (finally) upheld the airline's position that such terms are fair and reasonable.

The EU is "addressing" the issue, in their draft rewrite of Regulation 261, by requiring airlines to accept hidden city passengers but allows the airline to charge the fare that applies to the journey the passenger actually (intends to) takes. In other words they agree that lower fares cannot be secured from Hidden City ticketing.

Booglebox

13th Jan 2015, 12:03

Interesting.
The other day I went somewhere via Munich and a couple of days before I travelled, it turned out that I actually had to go somewhere which is fairly close to Munich instead of my destination.
I considered asking the airline (LH) if I could exit at Munich but instead I decided to go home for a night before continuing on, for various reasons. I guess if I had asked they would have looked at this fairly dimly and accused me of being a hidden-city ticketer?

Gibon2

13th Jan 2015, 12:34

Hidden-city ticketing is certainly a breach of contract, and as ExXB says if you are caught doing it you will likely be refused carriage. But there is not much more the airline can do. In theory, the airline could sue you for damages arising from the breach of contract, but clearly this will rarely be a worthwhile undertaking.

It is not fraud; fraud is a criminal offence in most countries - and I am not aware that hidden-city ticketing is illegal anywhere. If it was fraud, in the legal sense, then airlines could quickly stamp out the practice with a few prosecutions, which even if unsuccessful would likely have a dampening effect.

I don't think that breaching the terms of a commercial contract - even deliberately and with premeditation - is fraudulent in and of itself.

But this is by the by; I wonder if Mixture has actually read the article yet?

Heathrow Harry

13th Jan 2015, 15:07

they'd never get a jury to convict - or a judge either

the airline would have to show a "loss" or "damage" - any passenger could reasonably argue they were SAVING them fuel by not occupying the seat on the last leg

fa2fi

13th Jan 2015, 15:38

Not the same, but similar, I remember needing to fly SYY-GLA. One way was something stupid like £230 (this is 17 years ago) and when asked how much a return was I was informed it was illegal to knowingly buy a return with no intention of using it. I booked the return flight and got to GLA for £105, never had any letters or knocks at my door!

eastern wiseguy

13th Jan 2015, 16:44

Similar tale here. Researching a flight from DUB to CLE came out as ridiculous $$$ . Tried a flight DUB-DTW with the intention of a one way car hire to CLE . It was cheaper ,much cheaper. Guess what? There was a change of flights at CLE.....

ExXB

13th Jan 2015, 17:28

Heathrow Harry, the airline doesn't have to take you to court.

If it's a on-off they will probably ignore it.

If they detect persistent abuse of their terms and conditions, which the passenger has explicitly agreed to, they will likely contact the passenger and ask them to cease and desist. If the passenger continues then they will likely blacklist the passenger (Their right to do so is also in their terms and conditions).

If an agent is issuing the tickets they will charge back the differences to the agency. They can and have done this. Few agents are willing to take the risk.

The airline's simply have too much to lose than to allow this to become common practice.

Oh, and good luck keeping any FF miles you made on these trips.

Edited to add - passengers have taken airlines to court attempting to have such airline practice declared illegal. While they have succeeded in low courts they have never succeeded in appeal.

mixture

13th Jan 2015, 19:04

Oh, and good luck keeping any FF miles you made on these trips.

Indeed and infact if you're doing hidden-city ticketing on an FF programme, the game's up before you've started because the airlines can easily do a few database lookups of ticket purchases vs recorded sectors on your FF account .....i.e. they'll have even more data available to prove you're up to something.

In this day and age, FF members abusing ticketing rules may well find themselves talking to the airline's Revenue Protection and Integrity units sooner than they think !

Even without FF programmes, don't underestimate the power of the database....

PAXboy

13th Jan 2015, 19:51

I don't think I've ever done a 'H-C' trip and have no intention of starting but I shall continue to watch the fight with amusement.

On the side of the carriers - Through my participation of PPRuNe, I know that they do not make the money they used to and am well aware of the rapidly changing passenger loads (all the usual causes) and the contrasting long financial commitments they have to undertake. More change is yet to come.

fdcg27

13th Jan 2015, 22:43

Having paid exhorbitant fares on some flights, I wouldn't feel too badly about taking advantage of a hidden city ticket deal.
I'm not too concerned about the heads I win tails you lose contract of carriage, where even cancelled flights don't bring the traveler a refund of the fare paid for a service not delivered.
You're right, in that having given exposure to the practice will only encourage more travelers to look for and find hidden city deals, as long as they can travel with carry-on bags only.
Could this be the reason that many carriers now deliver gate checked bags only at the baggage claim at final ticketed destination?

ExXB

14th Jan 2015, 07:38

I'm not too concerned about the heads I win tails you lose contract of carriage, where even cancelled flights don't bring the traveler a refund of the fare paid for a service not delivered.

Other than an airline going out of business I've never heard of this happening. Even in those rare cases some refunds are made and/or other airlines offer discounted fares to get stranded passengers home.

You're right, in that having given exposure to the practice will only encourage more travelers to look for and find hidden city deals, as long as they can travel with carry-on bags only.
Could this be the reason that many carriers now deliver gate checked bags only at the baggage claim at final ticketed destination?

It only really works on one way tickets, or two tickets each with a hidden city. I doubt this would be the main reason for bag-check to destination, but it certainly doesn't hurt them to do so.

Having paid exhorbitant fares on some flights, I wouldn't feel too badly about taking advantage of a hidden city ticket deal.

So you are saying it is OK to cheat the airline out of their published fares because you don't like them, or consider them exhorbitant? Try that in a shop.

Metro man

14th Jan 2015, 07:52

Airlines also prohibited back-to-back ticketing or nested ticketing. A traveler wants to make two round trips midweek. At one time, airlines typically charged more for midweek round trips than trips that involved a Saturday night stay. This ploy allows the traveler to book two round-trip tickets with Saturday stays even though the actual travel is all midweek. If a business traveler wanted to make two round trips from New York to Los Angeles in two consecutive weeks, the traveler could book a round trip leaving New York Monday of week 1 and returning to New York Friday of week 2. Then the traveler could book a second round-trip ticket in the opposite direction, leaving Los Angeles on Friday of week 1 and return to Los Angeles Monday of week 2. In week 1, the traveler flies the first leg of the first ticket, then returns home on the first leg of the second ticket. The following week the traveler flies from New York to Los Angeles again, this time on the second leg of the second ticket, and finally returns to New York on the second leg of the first ticket.

A humorous comparison:
If Paint was sold like Plane Tickets

Buying Paint from a Hardware Store:

Customer:
Hi. How much is your paint?

Clerk:
We have regular quality for $12 a gallon and premium for $18. How many gallons would you like?

Customer:
Five gallons of regular quality, please.

Clerk:
Great. That will be $60 plus tax.

Buying Paint from an Airline:

Customer:
Hi, how much is your paint?

Clerk:
Well, sir, that all depends.

Customer:
Depends on what?

Clerk:
Actually, a lot of things.

Customer:
How about giving me an average price?

Clerk:
Wow, that's too hard a question. The lowest price is $9 a gallon, and we have 150 different prices up to $200 a gallon.

Customer:
What's the difference in the paint?

Clerk:
Oh, there isn't any difference; it's all the same paint.

Customer:
Well, then, I'd like some of that $9 paint.

Clerk:
Well, first I need to ask you a few questions. When do you intend to use it?

Customer:
I want to paint tomorrow, on my day off.

Clerk:
Sir, the paint for tomorrow is the $200 paint.

Customer:
What? When would I have to paint in order to get the $9 version?

Clerk:
That would be in three weeks, but you will also have to agree to start painting before Friday of that week and continue painting until at least Sunday.

Customer:
You've got to be kidding!

Clerk:
Sir, we don't kid around here. Of course, I'll have to check to see if we have any of that paint available before I can sell it to you.

Customer:
What do you mean check to see if you can sell it to me? You have shelves full of that stuff; I can see it right there.

Clerk:
Just because you can see it doesn't mean that we have it. It may be the same paint, but we sell only a certain number of gallons on any given weekend. Oh, and by the way, the price just went to $12.

Customer:
You mean the price went up while we were talking!

Clerk:
Yes, sir. You see, we change prices and rules thousands of times a day, and since you haven't actually walked out of the store with your paint yet, we just decided to change. Unless you want the same thing to happen again, I would suggest that you get on with your purchase. How many gallons do you want?

Customer:
I don't know exactly. Maybe five gallons. Maybe I should buy six gallons just to make sure I have enough.

Clerk:
Oh, no, sir, you can't do that. If you buy the paint and then don't use it, you will be liable for penalties and possible confiscation of the paint you already have.

Customer:
What?

Clerk:
That's right. We can sell you enough paint to do your kitchen, bathroom, hall and north bedroom, but if you stop painting before you do the bedroom, you will be in violation of our tariffs.

Customer:
But what does it matter to you whether I use all the paint? I already paid you for it!

Clerk:
Sir, there's no point in getting upset; that's just the way it is. We make plans based upon the idea that you will use all the paint, and when you don't, it just causes us all sorts of problems.

Customer:
This is crazy! I suppose something terrible will happen if I don't keep painting until after Saturday night!

Clerk:
Yes, sir, it will.

Customer:
Well, that does it! I'm going somewhere else to buy my paint.

Clerk:
That won't do you any good, sir. We all have the same rules. Thanks for painting with our airline.

If you want to do hidden cities ticketing, forget the FF miles, book using pre pay credit cards, have a few different addresses and try slight name changes eg
John Smith, Jonh F Smith, Johnnie Smith, J Smith ESQ, J Smith Jnr etc.

A couple of driving licences from different states should give enough possible combinations to stay ahead of the system for all but the extremely regular flyer.

Gibon2

14th Jan 2015, 08:10

So you are saying it is OK to cheat the airline out of their published fares because you don't like them, or consider them exhorbitant? Try that in a shop.

A shop could never get away with the type of pricing that airlines use. Cue the famous if airlines sold paint (http://www.pprune.org/jet-blast/73675-if-airlines-sold-paint.html) analogy. (EDIT: beaten to the punch by Metro man above!)

I'm not endorsing the practice of H-C ticketing, and don't use it myself (although I confess to occasionally buying return tickets for one-way use). But I'm sure many travellers suspect that if an airline charges more for a trip A-B than it charges for A-B-C, then the price for the A-B trip is artificially inflated, and the airline is therefore cheating them. In such circumstances, they would see H-C ticketing not as cheating but as a morally justifiable way of righting the initial wrong.

But coming back to United's dilemma - cracking down on H-C ticketing is likely to draw attention to the practice and to increase its prevalence. The options for airlines are limited: it is one thing to blacklist 10 persistent abusers, but quite another to blacklist 10,000. The only real option is to adjust the pricing to make H-C unattractive. Whether this would be better or worse for consumers overall is hard to judge.

ExXB

14th Jan 2015, 10:48

Giben2

When an airline looks at pricing for AAA to CCC in considers the competitive factors in the AAA to CCC market. Fares charged by other airlines, fares applicable to nearby airports, market analysis on what passengers are prepared to pay, supply and demand, and a million other considerations.

The fares to BBB are irrelevant in this analysis. What people are able and willing to pay to CCC is. If you charge the higher BBB fare (or the sum of the sector fares) you will not sell many, if any, tickets. If the airline decides it wants to be in the AAA CCC market it will have prices that it believes it can sell in that market. If it decides it doesn't want to be in that market it will not offer competitive fares.

The airline must decide if it will have empty seats AAA-BBB and BBB-CCC and if the revenue it receives for the total journey is better than no revenue (and having the seats fly empty) at all.

Pricing for an individual seat is not cost plus, it can't be. Pricing must ensure that the total revenue received for a flight exceeds the cost of operation plus a little more for the shareholders.

mixture

14th Jan 2015, 11:35

Pricing for an individual seat is not cost plus, it can't be.

Yup. Never has been. Never will be.

Gibon2 needs to go away, do a great deal of bed time reading and then come back with a more realistic viewpoint on how airlines work !

A trip to the local library to peruse a few issues of Journal of Revenue and Pricing Management might be a start if you want a cutting-edge view on the matter, otherwise a few theoretical books on the subject of Revenue/Pricing/Yield management.

As ExXB says Gibon2, the airline business is cut-throat and highly-competitive and a vast number of business inputs are fed into the magic black box that spits out the prices. The basics such as cost of fuel, staff, lease on the aircraft is only really the start of a very long list indeed.......

SLF3

14th Jan 2015, 12:01

Not just flights. Coach tickets to London Victoria on services that stop at Heathrow are cheaper than tickets to Heathrow.

Whether more people get off than should at Heathrow I cannot say.

Gibon2

14th Jan 2015, 12:18

Mixture and ExXB, I was not talking about how airline pricing works. I am well aware of how it is done (in principle). The Economist article linked in my OP (which Mixture still evidently hasn't bothered to read) has quite a good explanation of how the A-B vs. A-B-C pricing difference eventuates.

I was talking about how it appears to the average punter, who couldn't give a toss about the arcane practices of airline revenue management, but sees nothing wrong in using only a part (A-B) of what he or she has paid for (A-B-C).

And mixture, are you still maintaining that hidden-city ticketing is fraud? No doubt you can quote cases, judgements, etc, to that effect?

mixture

14th Jan 2015, 12:22

And mixture, are you still maintaining that hidden-city ticketing is fraud? No doubt you can quote cases, judgements, etc, to that effect?

Please Gibon2, be sensible ....I'm not going to waste time on LexisNexis for your benefit either.

The definition of fraud is as I have quoted, or if you prefer, I'll quote you a legal definition from Black's dictionary (http://thelawdictionary.org/fraud/) :

Fraud consists of some deceitful practice or willful device, resorted to with intent to deprive another of his right, or in some manner to do him an injury. Fraud, as applied to contracts, is the cause of an error bearing on a material part of the contract, created or continued by artifice, with design to obtain some unjust advantage to the one party, or to cause an inconvenience or loss to the other.

Therefore, inline with that definition, a passenger buying a back-to-back ticket on an airline in order to pay less money, the passenger is the party obtaining the unjust advantage.

But a prosecution for fraud would obviously be the last resort option. The airlines have 101 other tools at their disposal to deal with offenders, many of the options don't even involve a judge in court and can be dealt with on a customer/supplier level.

I retain my original position that there are 101 ways you can legally save a large amount of money on airfares without having to resort to illegal options and/or breach of contract.

As ExXB said, hidden-city rules et. al have been in existence on airfares since time immemorial ... these have been challenged, time and time again .... and each time the people challenging them have lost and the rules remained in place, as they should !

Show more respect for the airlines Gibon2, and the dog-eat-dog industry in which they operate. I bet you would struggle to run an airline on the basis you are proposing it.... if it were possible to take such a simplistic view on pricing matters, somebody would have done it already !

Gibon2

14th Jan 2015, 12:40

You seem to have some problems with reading comprehension mixture. I have not proposed anything with respect to airline pricing. I have not suggested that their pricing approach is incorrect, unjustifiable, or anything else. Why do you think I have?

And again, have you actually read the article?

And just to clarify, you maintain that hidden-city ticketing is illegal?

ExXB

14th Jan 2015, 13:18

Is 'hidden-city ticketing' illegal?

If a customer was to change the price of any product or service, without the knowledge and agreement of the retailer, and attempted to avail themselves of that product or service at a lower price than that sought by the retailer (for example, switching price tags) - in my view that would be illegal.

If I did it in a shop, I could be arrested because the retailer has decided I was stealing from them and has chosen to prosecute.

Airlines have not chosen to deal with hidden-city ticketing as a criminal act, but as a civil breach of contract. That decision does not make the activity 'legal', but it remains a substitution of prices for which the seller has not been informed or agreed to.

This young man is accused of counselling customers to breach their contracts with airlines. Now, is that 'illegal'? We shall see.

Bushfiva

14th Jan 2015, 13:25

You don't get to choose whether something is a civil or criminal issue.

ExXB

14th Jan 2015, 13:40

Sure you do. If someone shoplifts or switches price tags in a shop the retailer can decide not to have the criminal arrested, or not to prosecute. If they did that wouldn't mean a crime hadn't been committed - just that they chose not to prosecute.

Now if it was the cops see that saw the criminal activity, you may be right, but if the retailer chose not to prosecute ...

In fact I think most police expect a criminal complaint before they take action.

Bushfiva

14th Jan 2015, 13:49

You're accidentally or deliberately misinterpreting the situation. Hidden cities is, possibly, a breach of contract. The airline doesn't have the option of making it a criminal offence. You can't manufacture criminality on demand.

ExXB

14th Jan 2015, 14:37

Hidden cities is a breach of contract. No doubt there. Time and time again the courts, government agencies and consumer associations, have agreed that the terms are fair.

Forget I suggested it could be a criminal offence too. That has no bearing on the discussion and I apologise if I mislead anyone.

But the issue here is not the validity of the contract terms. That has been settled. The issue here is if someone counselling others to breach their contracts.

mixture

14th Jan 2015, 15:14

The airline doesn't have the option of making it a criminal offence.

Sure they have the option, but lawyers cost money and building a case costs time.... much cheaper to resolve out-of-court on a supplier/customer level.

If you look, for example, at the CPS notes for "Fraud by false representation (Section 2)" :

The defendant:
• made a false representation
• dishonestly
• knowing that the representation was or might be untrue or misleading
• with intent to make a gain for himself or another, to cause loss to another or to expose another to risk of loss.

The offence is entirely focused on the conduct of the defendant.

A false representation can be express or implied, stated in words or communicated by conduct. So the act of knowingly buying a hidden-city ticket would be implied by conduct.

But as I said, it takes time and money to build a case, and the airline already has 101 non-legal tools at its disposal that are very effective. So recourse to law would be a last resort.

dClbydalpha

14th Jan 2015, 19:50

I can understand that an airline cannot price their tickets on the basis of cost plus ... it's simple maths as, unlike producing and selling paint, the fixed costs of providing the flight are dominant compared to the proportionate unit (per seat) costs. *The only cost plus formula that would work would be if the 1st ticket buyer paid all the fixed costs, then upon a second ticket being sold the first ticket holder gets a refund of half etc. etc. to do this would be clearly ridiculous.

1) The point of this is not airline revenue. *Logic dictates that if I have bought a ticket that entitles me to fly from A-B-C then the airline, using whatever revenue formula they use, have ensured they have covered both legs A-B and B-C. *It makes no difference to the airline revenue whether I sit in the seat or not. *I have paid the money and they have provided the flight. *The fact that they could have charged more, due to supply and demand, for the leg A-B if I hadn't already taken the seat is not a loss of revenue, simply a loss of extra profit - the complex revenue calculation must already have accounted for that overall - other wise if everyone on the flight flew A-B-C they would always make a loss and the airline would be forced to re-evaluate its pricing policy. *Simple.

2) Airlines often overbook flights. *It has happened to many people on this forum. *In this instance the airline chooses to take the risk that some people will "no show". *This is an accepted practice. So not everyone always gets to fly anyway.

3) The airline could choose to take legal action, but they would probably lose. *Firstly if I have paid for the service in full there are no consequential damages on the service provider. *They have the money, as point 1 has shown they may have lost potential further profit, but this is not actual and so could not be proven as had I been there they would not been able to obtain that profit. *So although a contract has been breached there are no damages and so nothing to be recovered. But what is being said by some here is that it is my contractual obligation to complete A-B-C. Are peolpe really suggesting that if I turn up at the airport and check in, I no longer have the freedom of choice to turn around and leave the airport without flying? *Seriously, any airline that tried to bring that case to court would be a laughing stock.

In summary, airlines are using complex pricing structures and algorithms to maintain profit whilst being competitive. *They are water tight contractually against anyone seeking the right to demand to be let off at B, i.e. they can wash their hands of any responsibility for anything that may happen at B for example security or baggage. They, just like any other business, can refuse to deal with a customer if they feel that they are repeatedly taking advantage, but this is a commercial not legal decision. In the end, as had already been pointed out, the result is that the revenue protecting algorithms get altered to accommodate this.

fdcg27

15th Jan 2015, 00:10

You obviously don't do much flying in the US.
You can have a flight cancellation here, which the airline will invariably blame on weather, and unless you bought a refundable ticket for 4X the fare, which nobody does, there is no refund. You now have a credit which you can use on some future flight subject to various restrictions.
Getting rebooked here is also difficult, since load factors have been very high for the past five years or so. Unless you are aware of the possibility of being interlined or flowed through novel connections and make the CSA pursue it, your travel plans are left in shreds.
You sometimes have to use your own phone to find a routing that will work and then get the CSA to make it happen.
Been there, done that.
If you're charming, polite and well informed, the airline staff can usually be pursuaded to do what they're suposed to do for any stranded traveler.

Ka6crpe

15th Jan 2015, 01:36

You would think that if an airline sells a seat for travel A-B-C, but the passenger only uses A-B then the airline should be very happy. They have saved some fuel, saved an in-flight meal, and less work for all staff concerned.

I do not see their problem.

GrahamO

15th Jan 2015, 01:57

Interesting that the conversation doesn't touch on whether the clause in the terms is actually legal or enforceable.

When you get on the aircraft, you don't become an indentured slave and I would suggest they airlines would have a hard time convincing a court that the passenger must be restrained and shackled to their seat to complete the journey. Thats in effect what the clause is suggesting.

Given the American liking for freedom from just about anything, it'll go the way of many contract clauses and be found legally unenforceable on a passenger.

As to the attempt to stop him telling people where to find the tickets, the airline will lose on 1st Amendment grounds - its the equivalent if running around out side your house demanding that everyone close their eyes when they go past because there's a large hole in the front door, and then insisting that you tell nobody.

Gibon2

15th Jan 2015, 07:17

Interesting that the conversation doesn't touch on whether the clause in the terms is actually legal or enforceable.

The conversation has touched on it, several times. ExXB has told us that the clause has been challenged in various courts over the years, and has ultimately been upheld as legal.

When you get on the aircraft, you don't become an indentured slave and I would suggest they airlines would have a hard time convincing a court that the passenger must be restrained and shackled to their seat to complete the journey. Thats in effect what the clause is suggesting.

Not really. The clause just gives the airline the right to claim back from the passenger the difference in price between the cheaper A-B-C fare the passenger paid and the more expensive A-B fare that the passenger flew. According to ExXB this can and does happen, especially when the ticket has been booked through an agent.

TowerDog

15th Jan 2015, 09:01

Hmm, Hidden City ticketing are still going on?
Have not heard the term in 25 years..:sad:
Used it once or twice myself and did not think it was a big deal, or fraud, rather a hidden "option"
I remember buying a ticket from Paris to Oklahoma City, as it was much cheaper than Paris to Dallas. Then getting off the flight in Dallas.:eek:

DaveReidUK

15th Jan 2015, 09:26

Hmm, Hidden City ticketing are still going on?
Have not heard the term in 25 years..
Used it once or twice myself and did not think it was a big deal, or fraud, rather a hidden "option"
I remember buying a ticket from Paris to Oklahoma City, as it was much cheaper than Paris to Dallas. Then getting off the flight in Dallas.

Article from the LA Times as far back as 1986 about hidden-city ticketing:

Airline Flap Over Hidden City Ploy - Los Angeles Times (http://articles.latimes.com/1986-04-27/travel/tr-23868_1_hidden-city-idea)

It implies that, in those days at least, airlines would go after agencies that promote the practice, but not individual travellers.

EEngr

16th Jan 2015, 00:30

So, what will they do in this case:

Flight from A through B to C is substantially cheaper than A to B. So I fly A-B-C and then take a bus back to B. I've deprived the airline of selling me the more expensive A-B ticket.

I question the whole ethics of the 'we could have sold you a more expensive X' logic.

PAXboy

16th Jan 2015, 01:07

As i understand it, it's called the 'free market economy' and is how the USA rule their lives. If so - then we may expect the courts to uphold the practice. Not so? If the market does not like this way of doing business, then the market will cause it's downfall. or so the rule book states. ;)

ExXB

16th Jan 2015, 07:27

EEngr

No, that isn't the case. What the courts focused on is what is part of the contract, that either party cannot change it without the express agreement of the other, and those components that are not key contract terms.

The airline's hold the view, and the courts have agreed, that passengers are contracting (in our example) for transportation from AAA to CCC. They are not contracting for transportation from AAA to BBB (which has a different price), or from AAA to CCC via BBB.

The routing the airline proposes to use to fulfil their obligation is not a key term of the contract. In the event of a schedule change or irregular ops the airline can change the intermediate point(s) or substitute a non-stop flight, etc. (these are also spelled out in the terms and conditions).

In your example the airline and the customer have satisfied the terms of their contract.

PAXboy

16th Jan 2015, 11:16

etrang

16th Jan 2015, 11:32

I'm rather surprised that these airlines and their sophisticated "revenue integrity" departments have never heard of the Streisand Effect.

Delight

16th Jan 2015, 11:33

I would actually say it is more like this; When you enter a shop, pick two items from the shelf and go to the till/cash register: When the staff says, "That is 49 cents" and you say "Yes" the contract is made. If you say, "I'll pay 49 cents but take one" no contract wil be made.

The person standing outside the shop telling potential customers that they can pay 49 cents and take just one item would indeed be encouraging those people to break the contract, but it is worth pursuing that person and giving them more publicity than they could ever dream of?

PAXboy

16th Jan 2015, 11:44

Yes Delight, that is correct.

Sadly, one probably outcome is the change in fares that will follow the example of RyanAir's 'Wheelchair tax'. But humans are not logical and the media like 'sound bites'. The pricing structure of airlines is extrmely complex as it has old roots that have had to have modern economica grafted on to them. I doubt that any company would start up with the process' they have now!

DaveReidUK

16th Jan 2015, 15:37

"I should like to buy an egg, please," Alice said timidly. "How do you sell them?"

"Fivepence farthing for one - Twopence for two," the Sheep replied.

"Then two are cheaper than one?" Alice said in a surprised tone, taking out her purse.

"Only you must eat them both, if you buy two," said the Sheep.

"Then I'll have one, please," said Alice, as she put the money down on the counter.

mixture

16th Jan 2015, 16:21

In the simplest form: When you enter a shop, pick an item from the shelf and go to the till/cash register: When the staff says, "That is 49 cents" and you say "Yes" the contract is made. If you say, "I'll pay 49 cents but take two" no contract wil be made.

The argument is that a person standing outside the shop telling potential customers that they can pay 49 cents and take two items would be encouraging those people to break the contract.

Not sure the second half of your post makes any sense. The first half about contract and acceptance does, and is exactly the problem with hidden-city-ticketing .... you and the airline make the contract on the basis of you traveling A-B-C, not A-B.

dClbydalpha

16th Jan 2015, 17:29

I think the contract is from A-C within defined times and limits.
That's the point I was trying to make, the clause the airline invokes protects them against the insistence that you travel via B. If the aircraft stops at B and I can get off and out with no impact to the airline then it is my right. I am a free person. If the airline wishes to sue me for breach of contract they can. But, in general they will fail because there has been no damage to them as a result. They could point to a clause that says I have to pay full fare, but again it could be disputed that this is just and fair as there is no basis for the charge other than the contract itself. I suspect judgements have gone either way in the past. They can also choose not to do business with a repeat "offender" as it wouldn't be discrimination, but why turn down business?

PAXboy

16th Jan 2015, 18:00

dClbydalpha If the aircraft stops at B and I can get off and out with no impact to the airline then it is my right. I am a free person. If the airline wishes to sue me for breach of contract they can. But, in general they will fail because there has been no damage to them as a result. They could point to a clause that says I have to pay full fare, but again it could be disputed that this is just and fair as there is no basis for the charge other than the contract itself. I suspect judgements have gone either way in the past.

ExXBHidden cities is a breach of contract. No doubt there. Time and time again the courts, government agencies and consumer associations, have agreed that the terms are fair.

DaveReidUK

16th Jan 2015, 19:20

It would be good to see some actual case law, rather than just conflicting assertions.

mixture

16th Jan 2015, 21:22

It would be good to see some actual case law, rather than just conflicting assertions.

If you don't believe what ExXB is saying, go look it up yourself if you are determined to prove ExXB wrong... :E

Given ExXB's location is stated as "Confoederatio Helvetica" and stated age suggests is of working age probably in a senior position, I would hazard a guess that ExXB ought to be given the benefit of the doubt as ExXB probably knows what's what.

ExXB

16th Jan 2015, 21:34

Suffice it to say that if any airline had lost even once it would have been headline news in every tabloid rag on the planet. Everyone would be doing it, and we wouldn't be having this discussion.

Capot

16th Jan 2015, 22:13

My Ticketing & Res.course with BOAC (yes, that long ago) took several weeks, due to the complexity of the subject among IATA airlines.

We were trained to explore every possible option on behalf of the customer until we found the optimum route and price to get him or her to where they wanted to go, including ancillaries like hotels and surface connections.

On a complex journey, it was common to spend hours on a single customer's long haul explorations, writing connected tickets with up to 10 or more flights coupons on a single fare payment.

Among the many strategies available when constructing a total fare was one known as "fictitious waypoints" or something like that, used to reduce a fare if possible. It was not only legitimate, but we were encouraged to use it.

It would have been very late '60s, early '70s, I think and continued for some years after that, probably until giving the customer the best possible deal became a sacking offence in most airlines.

There's nothing new in "hidden cities". What has changed is that airlines now seek to fleece their customers to the maximum possible extent, using ponderous legal threats as a revenue enhancement tool, rather than providing a good deal and the best possible service.

YorkshireTyke

16th Jan 2015, 23:09

Apologies for not researching now, but wasn't there a recent incident in England where a train passenger was prosecuted for buying a ticket from London (?) to Southampton, and alighting at the stop before Southampton (Eastleigh ?).

Metro man

16th Jan 2015, 23:44

Correct
Couple fined for getting off train too early - Telegraph (http://www.telegraph.co.uk/news/uknews/road-and-rail-transport/7983548/Couple-fined-for-getting-off-train-too-early.html)

8:07AM BST 06 Sep 2010
Emma Clark and her fiancé Davyd Winter-Bates were travelling home to Southampton, Hants, from London when they decided to alight two stops early at Eastleigh.
However, they were shocked when they handed over their tickets and were told they had to pay a penalty for not staying on the train until their destination.
They were each fined £57 by the rail operator South West Trains – twice the cost of a standard fare of £28.50.
Miss Clark, a 22-year-old art student from Bishopstoke, Hants, told The Sun: “It is utter madness. I could understand being fined if I had stayed on the train two stops beyond my destination.”
The train company said the couple incurred the fines because they were using discounted tickets, which were not valid for travel to Eastleigh.
Related Articles
Half of all rail ticket advice is wrong 24 Feb 2011
The pair had bought the single tickets for £6 online and were not aware of the conditions.
A South West Trains spokesman said: "The customers in this case booked a journey from London Waterloo to Southampton through the megatrain.com website. Megatrain.com does not offer journeys or fares from London to Eastleigh.
"It is made very clear in the terms and conditions of travel that leaving the train at an intermediate station is not permitted on these heavily discounted tickets.
"As with any service offered by any company, it is important passengers comply with the terms and conditions.
"This particular journey is provided on a South West Trains service. It took place in a penalty fare zone, where anyone travelling without a valid ticket is liable to pay £20 or double the full standard single fare, whichever is greater.
"In this case, the tickets were not valid for travel to Eastleigh. The cost of the full standard single fare from London to Eastleigh is £28.50, resulting in a penalty fare of £57 for each passenger."
The couple were on their way home after a theatre trip and hotel stay in the capital to celebrate Mr Winter-Bates’s 25th birthday.

But remember there may be a ticket check as you leave a station which would pick this up, I've never seen one at an airport.

Dryce

17th Jan 2015, 00:11

Couple fined for getting off train too early - Telegraph

It's worth bearing in mind that the railways work with specific laws and terminolgy regarding ticketing.

If there was similar dispute with an airline in the UK then presumably this would be handled under contract law and the airline would have to prove damages?

Whereas with the railway the issue whether the passenger has a valid ticket for the journey because this may be handled as a crimninal offence if you fail to settle it via a penalty offer.

mixture

17th Jan 2015, 00:17

If there was similar dispute with an airline in the UK then presumably this would be handled under contract law and the airline would have to prove damages?

Fairly straight forward to demonstrate the difference of cost in the ticket between what you paid and what you should have paid. Also associated catering etc.

beeg0d

17th Jan 2015, 07:51

Exept its not quite that straight forward. There are 2 different ways to work out the airlines cost.

1 the difference in fair between a-b-c and a-b

2 the cost of to the airline of the pax not occupying their paied for seat on b-c (cost £0)

a case brought in the UK would bee under civil law (where fines/penatlys cannot bee issued). under UK civil law where there is ambiguility (ie 2 different methods to work out costs) in a contract the clouse that benifits the person who did NOT write the contract/t's&c's is the one that MUST be applyed.

The story metro man linked to is different simply because it applys to train travel. In the old days Brittish Rail being owned by the government WAS allowed to impose fines/penatilies (and they dont even have to be "fair" unlike consumer contracts where ALL terms/clouses must be fair). This abbility to issue fines was maintained during privitation. The airline industry has never had this ability

Hipennine

17th Jan 2015, 08:40

The rail example is also different in that the Ts&Cs are very specific about the cost of "breaking the contract", so the purchaser is very aware (if they read the Ts&Cs) of the cost of their actions.

In the air ticket case, the additional cost is not specified. Just saying that the cost will be the normal single fare to the point of exit does not provide specific information. A "logical" person reading that would assume/argue that the cost of A-B would be less than they have paid A-B-C. If the ticket said something like "if you get off at B, there will be a supplementary fare of £500" that would be a different matter.

DaveReidUK

17th Jan 2015, 09:58

Suffice it to say that if any airline had lost even once it would have been headline news in every tabloid rag on the planet.

I'm happy to accept that an airline has never lost such a case.

I'd just like to see some evidence that they have actually won one, ie that hidden-city ticketing has ever resulted in a court case at all between an airline and an individual traveller.

If you don't believe what ExXB is saying, go look it up yourself if you are determined to prove ExXB wrong...

See above. I'm not interested in proving anybody right or wrong because I have no idea who is. I'd just like to see some evidence that airlines take individual passengers to court when it seems equally reasonable that they would avoid the risk of the adverse publicity that ExXB has referred to, should they lose.

ExXB

17th Jan 2015, 10:11

Capot, in the days the fictitious construction point was used primarily in calculating fares for round the world journeys. Primarily when the passenger's main destination wasn't half-way around the world. For example a London Passenger travelling to Jakarta travelling outbound via SIN and returning via TYO and NYC. The combination of west about and east about fares for cities along the route would differ, sometimes substantially. Fares for some cities were not available as the MPM was exceeded by more than 20%. For London the magic point was usually Jogjakarta as this point gave both the best total fare and the most MPM (maximum permitted mileage) for the passenger. It simplified the fare calculation for the airline/travel agent and gave the best IATA price for the customer. Also recall that no single airline could offer these itineraries - they required vast amounts of interline.

In the naughties the UK's OFT reviewed the airlines conditions of carriage, including these under discussion. With some tweaking of language (plain English and additional clarity) the OFT determined that these terms were not unfair under UK/EU legislation.

The fare for your journey is that from the point of origin to the destination as shown on your ticket. You may not change your itinerary, origin or destination without our agreement. Should you wish to change any aspect of your journey we will recalculate your fare and you will be given the option of accepting our revised fare or maintaining your original journey as ticketed. If you change your journey as a result of force majure we will not recalculate your fare, but you must advise us as soon as reasonable. (or words to that effect, I'm depending on memory here)

Sultan Ismail

17th Jan 2015, 14:46

I took a lot of interest in this subject in the '70's and support CAPOT's description of fictitious waypoints.
The specific example given was a flight from New York to Los Angeles, using Albuquerque as the fictitious destination.
In the fare system a routing was established New York to Albuquerque, this being just inside the mid-west fare zone. However the passenger ticket was issued to Los Angeles as this was the necessary intermediate point to complete the route. There was no crime in not issuing the Los Angeles to Albuquerque leg.
As CAPOT inferred this was in the era when Travel Agents were King. The internet has closed that scheme but does of course provide so much more options, that's progress.

ExXB

17th Jan 2015, 15:56

Sultan Ismail

Those were the days of heavy regulation where US domestic fares were fixed by the CAB (and International fares fixed by IATA, to be approved by CAB and other governments). Since the fares were identical on all airlines there was an incentive for agents/airlines to find fares for their customers that others couldn't match. Tickets were priced by hand, with few quality checks, and no computer loaded with all the up to date information that must be used.

Those days are long passed, and fares were substantially higher in real terms than today.

Capot

17th Jan 2015, 16:15

fares were substantially higher in real terms than today.Yes, well, of course they were. And what you got for your money was one hell of a lot more than you get now; it cannot be said that "nothing's changed; the product is just the safe arrival at the far end, as it always was, except it's now a fraction of the price it used to be, in real terms".

Those high fares meant that 70% load factor counted as full; they meant a civilised and pleasant experience that made an air trip an exciting and enjoyable event.

I know; silly old git hankering after a lost world. But let's not forget that it was the airlines, especially the locos, that led the race to the bottom; they generated a demand for awful, mass air travel by anticipating that if they created that product, stacked high and sold cheap, it would create its own, new demand. And they were right. Decent airlines were forced to follow them down the steepening slope to the bottom, and the rest is history.

It took Al Qa'ida to create a totally new security experience in airports, but the airports themselves contributed to the race to the bottom when they were taken over by shop-keepers, and turned into the dreadful emporia of over-priced tat that they are today.

Sorry; it takes little to trigger that rant!

ExXB - thanks for reminding me of using the allowable mileages....that in turn recalled that huge volume the IATA fares manual, and wading through it with a calculator handy....

IATA had its faults, but the fact that I could sit in my office, with a Fares Manual, IATA airlines schedules, and a telex, and put together an itinerary using a dozen carriers, all confirmed bookings, hotels too maybe, and issue a ticket on IATA paper that would be honoured round the world, was probably the greatest global unifying factor that there has ever been, and ever will be. Of course the confidence that they would be safe on all those airlines came from ICAO's work; another huge unifying factor.

EEngr

19th Jan 2015, 15:11

The fares to BBB are irrelevant in this analysis. What people are able and willing to pay to CCC is.Yes. And no.

Airlines often advertise different options and rates for a flight from AAA to CCC, either direct or with stops in BBB (sometimes BBB1, BBB2, .... etc.). I understand that the product difference actually being sold is the total trip duration and avoiding the need to make multiple connections. But consumer law (at least here in the USA) protects customers from being advertised one thing and then sold another. Even if you got them to sign a contract allowing the substitution of a different product at the vendor's discretion (AAA through Lower Slobovia to CCC).

Its interesting because at times I have negotiated intentional stopovers at intermediate cities when purchasing tickets. Round trip on BA, SEA-LHR-AMS and back. After getting the basic route established, I just asked the ticketing agent to extend the connection between LHR and AMS from a couple of hours to one week. No problem.

Yes, I understand that this was the term of the final contract. And I abided by it.

ExXB

19th Jan 2015, 15:52

EEng. A 'stopover' is different from a connection. The discussion at hand is about a contract to transport the passenger from AAA to CCC, not involving a stopover at an intermediate point.

The airline would have a price for AAA to CCC with a stopover at BBB. It probably would not be the same as the price for AAA to CCC without the stopover, but they would have a price.

In fact the airline would likely have a price for just about every conceivable journey one can take using their services. And their expectation is that one will pay their price for the journey that one intends to undertake, not the price for a journey one has no intention of doing.

If the airline agrees (as in your example) to change your itinerary at the original price that is certainly their decision. You have proposed an amendment to your contract and they have agreed. But we are talking about here of passengers changing key terms of their contract without the knowledge or agreement of the airline. Contract law, even in the US, does not allow one party that freedom.

And, I apologize, before I retired I had access to files containing case law in many, many jurisdictions supporting (in some cases after numerous appeals/reappeals) what I have been saying here. I no longer have access to these files and goo-goo isn't very good when you can't recall details - such as the litigants names.