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Monday, August 31, 2015

American Airlines Mistakenly Discounts Airfare by 90%. You Won't Believe What They Did Next!

Photo: AirlineReporter.com | Brandon Farris
Some customers found an unexpected and pleasant surprise last week while buying tickets online from American Airlines.
An apparent error on the airline’s website caused all published fares to be a mere fraction of normal prices for any ticket purchased.  It is unknown how long the error had existed, but information about the mistake was posted early in the day last Thursday on Flyertalk, a popular website and online forum for the frequent flyer community.
Flyertalk user flipside posted a screenshot image showing a round-trip business class ticket on American from Sao Paulo to Hong Kong that priced out to be R$1,255 Brazilian Reals (BRL), or approximately $350 US Dollars at today’s prevailing exchange rate.  The normal fare for that business class ticket is approximately US$3,350 (R$12,000); the same ticket in coach is about US$850 (R$3,060).  How could this sort of thing happen and, in cases like this, how would American respond?
Screenshot: Flyertalk | flipside.
Getting the fare wasn’t very straightforward, but instructions were given on how to change your “country of residence,” to Brazil, giving one access to the “mistake” fare.
Photo: AirlineReporter.com | Bernie Leighton
There is speculation that the error was caused when currency values were inadvertently transposed when the data was entered. Said another way, while the value of R$1.00 is approximately US$0.29, the data was entered as R$0.29 to US$1.00, or R$1.00 to US$3.45.  In layman’s terms, the US dollar was accidentally and massively overvalued against the real by a factor of almost 12 times, causing the resulting airfare to be about 1/10 the actual price.
The airline corrected the pricing error by late Thursday afternoon, and it is not known how many tickets were purchased with the error, but it was enough to create a days-long backlog in American’s Brazilian office, which is responsible for issuing the tickets, due to the fact that the fares were technically purchased in Brazil and charged in reals.
While American would not elaborate on the cause or details behind the error, a company representative did provide American’s official statement, saying, “American Airlines will honor mispriced fares that were booked last week in select international markets. We hope customers enjoy their experience with American and book with us again in the future.”
Photo: AirlineReporter.com | Bernie Leighton
This is in stark contrast to United Airlines’ decision when that airline suffered a similar pricing error in February of this year.  United chose to void “several thousand bookings,” bolstered by a U.S. Department of Transportation decision not to pursue any legal proceedings against the airline, after several complaints were submitted from passengers who had their itineraries canceled by United, even though tickets had been validated and issued for travel.  United claimed an element of fraud on behalf of customers, most of whom had to change their home country and currency to manipulate the booking system.
British Airways, a partner of American in the oneworld alliance, also canceled tickets issued just last week after a different pricing error caused trips from Germany traveling to Kuala Lumpur, Malaysia to price at US$1,350 in first class.  Many users on Flyertalk are crying foul over the cancellations, as well as the way the refunds were processed, sometimes leaving customers hundreds of dollars short, due to fluctuating foreign exchange rates and fees.
There are also sporadic reports that in spite of American’s official stance in honoring their mistake fares, some itineraries are still being canceled, repriced to the original higher fares, or unable to be ticketed.  However, most reports on Flyertalk seemingly confirm that American is indeed processing and issuing the mispriced tickets.
One user reports booking an economy roundtrip from Seattle to Rio de Janeiro for US$175; others are flying as far as Europe and Australia without touching Brazil, and sometimes not even flying on flights operated by American.
Flyertalk user jfkeze found first class seats on American partner Cathay Pacific for $1,300,  traveling from Brazil to Hong Kong via the U.S.  Cathay maintains a Five-Star rating from Skytrax, recognizing the airline as one of the best in the world.
First class cabin on Cathay Pacific.
Photo: Cathay Pacific
As for flipside from Flyertalk, he was able to book nine trips in first and business class from Rio to Hong Kong, Sydney, New York, Singapore, and Miami.  They have all been ticketed, and he has already departed on the first of his trips.
Mistakes happen, and some companies choose to reverse their mistakes and minimize their own losses, while others choose  accept their mistakes to be consumer-friendly.  In this case, even with apparent support from their peers and a government opinion establishing precedence to do otherwise, American chose to go against the grain and own up to their mistake.

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