On Sunday, a video surfaced of a 69-year-old man getting physically dragged from an overbooked United flight, and the internet reacted with reasonable outrage. You’ve probably heard something about it…
Since then, overbooking stories have been coming out of the woodworks and, most of the time, the strategy seems to work out fine — people change flights or cancel plans.
But sometimes it doesn’t. And, if you’re United this week, those times can cost you about $255m in a single day.
So why gamble by booking too many people?
It’s like hedging your bets on a house party by inviting 200 people when your place can only fit 150. Pretty much guaranteed a rager even if 60% of the “maybes” don’t show.
And, in the notoriously slim-margined airline business, just 3 empty seats on each of United’s 4,523 daily departures, means $2.7m in lost revenue every day (assuming a $200 ticket price).
So slightly higher stakes than throwing a dud party.
But it’s not like flight attendants are picking favorites…
The decisions are made by a complex algorithm (surprise!) which factors in the number of refundable tickets and past no-show rates.
Which includes your individual data so, if you’re a flake risk, they’ll probably sell more seats on your flight than usual.
After that, a real-live human adjusts these calculations to consider attendance-altering factors like weather, or other events that could cause people to miss their flights. Say, a music festival or Evan’s annual epic Easter Eggstravaganza.
Works pretty well, all things considered
Except when it doesn’t, and you have passengers held hostage on a tarmac until 4 of them “reluctantly” give up their seats.
To put it in perspective, United only bumped about 0.09% of passengers in 2015, so hopefully it’s not all that likely to happen. And, if does, airlines will usually offer you up to 4x the ticket retail price.
That said, the small percentage of bumped passengers still have no say in whether or not they can board the flight they paid for, even if they have to miss their niece’s birthday party/little league game/graduation.