Airlines: Overbooking and Bumping

A recent opinion piece in the Orange County Register attempted to justify the policy of most airlines to overbook flights, then bump some passengers to a later flight.

I almost never travel by air anymore because the reductions in service and the added security measures have eliminated what little enjoyment used to be associated with the experience.

The writer of the opinion piece bases his position on the following arguments:

1. Only about 1.45 of every 10,000 passengers get bumped.
2. People who make last minute reservations are actually more likely to get a seat. Without the overbooking policy, they would not have the opportunity to get a seat reserved by a "no-show."
3. The overbooking policy permits more planes to fly at full capacity, so all flyers benefit from the lower fare per seat.

On the surface the article seems to make sense, but I am concerned about those 1.45 passengers who get stiffed. The author gives us no data about the percentage of seats that are "no-show," or about how many last-minute flyers benefit from getting those seats. If those who benefit amount to 30 or even 3 per 10,000, it may "offset" the inconvenience for the 1.45 who are bumped.

The lack of data on the number of no-shows also gives us no insight into the financial benefit for the 9,998.55 passengers who get seats. If, on those flights, there are only 500 no-shows, the per ticket savings on fares may be around $5.00. So the 9,998.55 passengers are $5.00 per person happier at the expense of those 1.45 people who are grievously inconvenienced.

In the absence of more data, it appears to be another business decision that benefits the airline company by dumping on some of its customers.