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Secretary Buttigieg Delivers Remarks at Washington National Airport to Announce Major Airline Consumer Protection Rules

Wednesday, April 24, 2024

Washington, DC – Building on the Biden-Harris Administration’s historic record of expanding consumer protections and standing up for airline passengers, U.S. Transportation Secretary Pete Buttigieg announced today two final rules that will deliver automatic cash refunds when owed to airline passengers and protect consumers from surprise airline junk fees.  

The rules are part of the Biden-Harris Administration’s work to lower costs for consumers and take on corporate rip-offs. President Biden signed an Executive Order on Promoting Competition in 2021 that encouraged DOT to take steps to promote fairer, more transparent, and competitive markets.  

Read Secretary Buttigieg’s Remarks Below: 

First of all, thanks very much to Bill McGee from the American Economic Liberty Project, someone who dedicated so much of his professional life to aviation first as a public servant and then as an advocate, and I want to note that this is really the culmination not just of work by our USDOT team, but of a community of advocates like Bill who have stood up for the rights of airline passengers and to make sure airline passengers and workers are better off. 

I also want to thank DCA for hosting us at an airport that I experience often as a passenger as well as a policymaker. And I want to recognize our Department’s OACP. Our Office of Aviation Consumer Protection, which is a small but mighty team that has helped millions of passengers get billions in refunds – handling compliance enforcement regulation and rulemaking all at the same time. 

And thanks all of you for joining us here.  

This is a big day for America’s flying public. It represents the latest step – two steps in fact – in our ongoing journey as a Department of Transportation, under President Biden’s leadership, to deliver the biggest expansion of passenger rights in the Department’s history. 

The news comes as we enter the middle years of America’s infrastructure decade, a period which has already seen enormous upheaval and change in the aviation sector. When we got here just three years ago, the big question around airlines was about whether they would survive the pandemic. A year later, the challenge was to ensure they could do a better job meeting unprecedented growth in demand. Through it all, we have been focused on making sure passengers, workers, and the sector as a whole, would be better off than before we got here.  

Telling stories, good and bad, about your flight is an American pastime. From stories of people coming up to me in airports, to stories that we formally receive in the form of comments and complaints through our rulemaking processes and our enforcement activities, we have heard it all. Too often, the things we have heard aren’t just irritating inconveniences – they are significant harms, and more importantly, violations of passengers’ rights. We are here to do something about that.  

A lot of what we hear from passengers involves refunds – or the lack thereof – for passengers who experience cancellations and disruptions. In theory, passengers are already supposed to be refunded for a cancellation or a major delay. In practice, it often does not work that way. We hear again and again from passengers who describe how hard they have to push just to get the refunds that are owed them – and often our Consumer Protection team has had to impose multimillion-dollar penalties on airlines just to get them to do what should already be required. Infrequent fliers are especially vulnerable, since they may not know that we are here for them, and are often not told about their right to a refund, and too often instead offered compensation in form of a voucher or miles whose value amounts to pennies on the dollar of what they are actually owed. Or they enter the vortex of call centers and chatbots, sometimes giving up before they get their money back.  

We’re changing that today. 

With the first rule that we are announcing today, the Biden-Harris Administration is now requiring that if an airline cancels or significantly delays your flight, within seven days they will be required to provide you an automatic refund to the credit card you used to book it – without you having to call or wait on hold, or sort through digital paperwork, or haggle with the airline.  

Importantly, we are also changing the refund to clarify that it must be in cash by default unless a passenger actively chooses another form of compensation, rather than the other way around. No more defaulting to vouchers or credits when consumers may not even realize they are entitled to cash.  

We are also putting another rule on the books: protecting airline passengers from being surprised by fees. These charges can really add up – for things like a checked bag, carry-on bag, change fees, cancellation fees. Healthy competition requires that as a consumer you can comparison shop, which means knowing the real price of a trip before and not after you buy. So airlines will now be required to show you those costs up front so you have all the information you need to decide what travel option is best for you. We estimate that this will save Americans over a half billion dollars every year. 

From day one of this administration, we have been working to improve the entire experience for airline passengers - from more transparency when you book your ticket, to a better experience when you get to the airport thanks to the terminal improvements that we’re making through the Biden infrastructure package, to the most important part of all, which is safety and peace of mind secured by better staffing, better technology, better oversight, and better infrastructure... and of course, knowing that if something does go wrong and your flight is canceled, the U.S. Department of Transportation has your back.  

It's why we launched to provide passengers with easy-to-interpret visuals that lay out exactly what each airline has committed to providing you if they cause your cancellation or delay. And we know that transparency made a difference because within days of my letting the airlines know that it was coming, we went from zero out of the top 10 airlines to all of the top 10 airlines guaranteeing in their customer service plans that they offer things like free rebooking and meals and all but one of them free hotel accommodations – commitments that our Department has the power to enforce. 

Of course, even with the new rules we’re announcing today that airlines will be required by law to follow, problems still come up.   

That’s where are our stepped-up enforcement comes in.  

When an airline is responsible for a delay or cancellation, we have set records for tough penalties, including the $140 million enforcement action against Southwest Airlines for the 2022 holiday meltdown. That’s nearly double the total amount of penalties this Department assessed fines in more than two decades before we got here. And the level of toughness reflected in the Southwest enforcement is not an exception but a new standard for our Department’s enforcement. 

And even more important than the fines that go back to the Treasury is what our Department is getting back into passengers’ pockets, which now stands at over $3 billion in refunds and reimbursements. 

And last week, we announced a new force-multiplier for our efforts – an unprecedented partnership with 18 state attorneys general to help investigate aviation consumer complaints and get passengers results. And we’re encouraging the rest of the states to join us too. 

Taken collectively, under this Administration, USDOT has advanced the largest expansion of passenger rights, issued the biggest fines against airlines for failing consumers, and returned more money to passengers in refunds and reimbursements than ever before in the Department’s history. 

This isn’t just about enforcing when something goes wrong – it’s making it less likely something would go wrong in the first place. When an airline knows that all, instead of just a few, of the passengers on a cancelled flight are likely to actually get their money back, it gives them a different set of reasons to put in the investment and the realistic scheduling that makes a cancellation less likely to begin with.  

To be clear, we want the airline sector to thrive. It’s why we put so much into helping them survive the pandemic, and honestly, it’s why we’re being so rigorous on passenger protection. This will build confidence in air travel at a time when airlines need to do more to secure passengers’ trust. And, to be clear, whenever it is appropriate we are also working side by side with airline’s operations personnel on things like deconflicting airspace closures for commercial space launches, or addressing the congestion in New York’s airspace by facilitating larger planes with more seats that can move more passengers without adding more takeoffs.  

This approach of collaborating where appropriate, pushing hard where called for, is working.  

After the pandemic, passengers had difficult years, especially in 2021 and 2022. But last year, cancellations reached a ten-year low. And this year is off to a good start, about 1.5% cancellation rate, which is well below the norm. 

Yet we know there’s still more to do. 

So we’re not done. We’re working on a rulemaking to expand rights to protect the safety and dignity of passengers who use wheelchairs, and another one to ban airlines from charging you a junk fee to sit together as a family. 

It’s all in keeping with President Biden’s vision on competition and consumer protection, including cracking down on junk fees to make everything from concert to inhalers more affordable.  

These dollars and cents add up for millions of Americans, and our laser focus on making it easier, more affordable and more convenient to navigate every system in America, from health care to banking to air travel, will continue.