United CEO sounds alarm about proposed airline laws

Over the last year, the Biden administration has taken an even deal of steps to are trying and reign in airlines by cracking down on policies that it feels are harmful to consumers.

On the tip of spring, Delta (DAL) , United (UAL) and American Airlines (AAL) came together to sue the Department of Transportation over new rules requiring them to reveal "junk fees" comparable to baggage and cancelation costs upfront.

The Credit Card Competition Bill that changed into put forward by senators Dick Durbin (D-Sick.) and Roger Marshall (R-Kansas) back in 2023 may in all probability be currently on the docket. While the bill is now not exclusive to airlines, many have expressed concern that requiring merchants to give consumers a decision of credit card networks to use for every purchase (for example, a customer using a Visa (V) card may perchance opt in to use the Mastercard (MA) network) would completely uproot their loyalty rewards programs.

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On the hot 2024 Global Aerospace Summit in Washington, United CEO Scott Kirby often also is named the proposed bill "bad policy" in a tirade against the proposed changes.

United CEO: 'Well intentioned but would just be bad policy'

"The one risk to [loyalty] programs are legislative initiatives that I'm sure are well intentioned but would just be bad policy, specifically the Credit Card Competition Act," Kirby said in due course of a legislative meeting reported by airline and travel web pages The Points Guy. He further added that over three million passengers use United's MileagePlus Program and that "customers love these programs."

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Numbers from the foremost most modern earnings reported by the Points Guy show that the MileagePlus program also brought United over $892 million or 6% of total revenue all at some point of the 2nd quarter.

The U.S. Department of Transportation is currently conducting a separate investigation into whether airlines use rewards programs to keep up customers with them using "potential[ly] unfair, deceptive, or anticompetitive practices."

Because the pinnacle of United, Kirby predictably spent the meeting singing the praises of MileagePlus specifically and rewards programs as a complete.

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It truly is why scrutiny of airline loyalty programs remains high

"The affinity, the loyalty people have for these programs is incredible," Kirby said further.

A most modern survey by points and travel platform Point.me found that United's MileagePlus is the third-best airline loyalty program all at some point of the sphere, at the back of just Air France-KLM (AFRAF) 's Flying Blue and Air Canada (ACDVF) 's Aeroplan.

The factors ranking programs included how easy (or not easy) it truly is miles to earn miles by ways apart from buying flights, how fast one will provide you with the choice to reach benefits like free flights and the value of said benefits all at some point of the points one accumulates — all things that the DoT is currently examining for devaluation and dynamic pricing that will get consumers lower than what is advertised to encourage them to spend with the airline.

Current Transportation Secretary Pete Buttigieg issued an announcement saying that airline miles "have change into definitely this sort of meaningful a element of our economy that many American citizens view their rewards points balances as a element of their savings."

The foremost U.S.-based airlines to whom the probe changed into addressed have now not yet replied (they have ninety days from after they were informed of it on Sept. 5 to take action.)

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