Column: Airlines scrap bereavement fares even as they make record profits

As Mitt Romney proclaimed in 2011, “Corporations are people, my friend.” But that doesn’t necessarily make them nice people.

Sue Ogle learned this after being informed last week by American Airlines that the carrier no longer offers discounts for people who’ve lost a loved one — even though, after the death of her father, she was told just the opposite by the carrier’s service reps, who made her jump through hoops to get a promised refund.

“Where’s the decency?” Ogle said. “I understand that they’ve changed their policy. But in a situation like this, you should back up what your reps are telling people.”

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At the very least, companies should be willing to make amends when their reps mislead or misinform. But customer service has become a low priority for many businesses, even as profits soar.

I didn’t know until Ogle, 60, contacted me that so-called bereavement fares are an endangered species. American and United did away with them in 2014. American was the first to pull the trigger.

The airline said at the time that it remained “committed to doing all we can to relieve the burden of our customers in times of need.” But it said bereavement fares were no longer needed “because walk-up fares are generally lower than in the past.”

United followed suit shortly afterward. Of the three remaining legacy carriers, only Delta Air Lines continues to offer bereavement fares.

It’s worth noting that in 2014, after those cheap walk-up fares mitigated the need for bereavement programs at American and United, airline profits began to take off as fuel costs plunged by 50% and as carriers filled a record number of seats.

Air fares declined last year but are on the rise again. Even though fuel costs remain at crazy-low levels, airlines have attempted six fare hikes since January and three have stuck, raising the average round-trip ticket cost by $22.

And don’t forget fees for such things as extra bags and more legroom. Consulting firm IdeaWorksCompany estimates that carriers made almost $11 billion from various fees last year, up 24% from a year before.

Many airlines are still even hitting passengers with a fuel surcharge, although now they call it a “carrier-imposed surcharge.”

Meanwhile, the 10 publicly traded U.S. passenger airlines saw combined profit of $24.2 billion last year, according to a recent estimate by the industry group Airlines for America.

That’s three times as much as the $7.3 billion they earned a year earlier — when American and United could no longer bring themselves to muster financial sympathy for grieving passengers.

Ogle’s father died Feb. 8 at the age of 95. A service was scheduled for Feb. 17 in Toledo, Ohio. Since this was spur of the moment, the Laguna Beach resident contacted American to see whether the airline still offered special prices for her round-trip flight from Orange County’s John Wayne Airport.

“I got a nice lady who said they didn’t have the bereavement fares anymore,” Ogle recalled. “But she said American will still offer a refund if you provide proof of your relative’s death.”

This was good news. Otherwise, Ogle, who has flown American for years, was looking at more than $1,500 in total ticket costs for her and her husband.

After returning home from the funeral, she followed the service rep’s instructions and tried to apply for the refund on American’s website. She kept getting an “invalid entry” notice.

So Ogle called the carrier again and reached another rep. Once again she was told that a refund was available, but she’d have to apply by mail. Following the rep’s instructions, Ogle made copies of her tickets, her itinerary, her father’s death certificate and other materials and mailed them to American.

She received an email from the carrier last week. It expressed American’s condolences for Ogle’s loss. But it said no special fares or refunds were available in such circumstances.

“Given the sometimes burdensome rules and requirements necessary for customers to prove their eligibility for a bereavement fare, we believe it is generally simpler, and often cheaper, for our customers to simply purchase whatever discount fare is available,” it said.

Make of that what you will coming from a company that posted record profit last year of $7.6 billion. That, according to Chief Executive Doug Parker, was way beyond what any airline has ever earned in a single year. The amount was more than double American’s $2.9 billion profit in 2014.

It’s not shocking to see a company that’s rolling in cash want to hoard as much as possible for itself and shareholders — that’s capitalism, after all.

Nor is it a surprise that, having done away with bereavement fares a couple of years ago, an airline would stick with its decision.

What makes Ogle’s case noteworthy — and the same can be said for all customer-service interactions — is that American apparently finds itself unable to acknowledge that its reps steered a passenger wrong. Twice Ogle was misled and twice she followed all the instructions given her to a T.

I’m not telling Parker how to run his airline. But if it were me, I’d recognize that a loyal customer wasn’t treated as thoughtfully as possible during a challenging time.

Even a modest gesture — 10% off her next ticket, say — would demonstrate that the company isn’t staffed by money-grubbing cyborgs.

Josh Freed, a spokesman for American Airlines, told me only that the carrier would reach out to Ogle “to better understand how this mix-up occurred.”

Maybe I can help. Try “human error.”

Corporations are people, my friend.

David Lazarus’ column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5 and followed on Twitter @Davidlaz. Send your tips or feedback to [email protected].

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