What If My Airline Folds?

These aren’t the best of times to be an air traveler.

US Airways’ chairman has said that in the event of a second bankruptcy filing there’s only a one to two percent chance the airline would survive. And his airline just filed for Chapter 11 protection.

Delta is grasping at straws to stay afloat. United is still mired in bankruptcy with emergence nowhere in sight. American has been disturbingly quiet. ATA is looking to default on a government loan. Northwest is busy making – and then unmaking – ludicrous pricing decisions.

The last airline to go belly-up was TWA, which was absorbed into American. I’m not sure that most of today’s travelers remember when Eastern or Pan Am ceased operations.

It’s anyone’s guess who will be first to liquidate (and yes, I believe there’ll be more than one).

But the real question is: What do I do?

Protect your investment. Buy on credit. You may be offered some protection from your credit-card company if your airline fails to deliver the product it promised. Insure your trip with travel insurance. As long as your carrier is not on the “Do Not Insure” list, your investment (less the premium) is protected. This is reasonable for the leisure traveler, but probably cost prohibitive for the road warrior. Check with your travel professional to see who made the list and who did not.

Protect your itinerary. When your plane is grounded, most legacy carriers will protect you on their planes. I imagine that protection will run you $100 in the form of a fee charged by the carrier. But don’t expect to be on time to your destination. You will need to modify or cancel your down line reservations. Be particularly careful in markets which are served by only a few carriers-if US Airways stops flying, American will take up what slack it can in the Caribbean, but rest assured that there is more slack than American can handle. Expect to be delayed at least a full day if not more.

Look out for code shares. Code shares are our worst fear. This “scheme” (to coin a British term) was to benefit the passenger, allowing greater reach by sharing equipment. In the beginning, no one ever imagined a partner to stop flying. When they do, chaos will reign. Lufthansa’s people on US Airways’ planes, Emirates’ people on Delta’s planes, Singapore’s people on United’s planes, Continental’s people on Delta’s planes. The list is long and frightening, but in this world of code shares, when one airline stops flying, it will probably affect the operations of ten to twenty other carriers. Remember, the code share partner entered into the agreement because they did not have the equipment to do it on their own in the first place.

What can you do? Step away from the Web.

Go back in time to the days when you always dealt with a human. Imagine the volume that online agencies (including the airlines own sites) automatically handle on a typical day? Now imagine the day when an airline stops flying. The online sites do not have a mechanism to handle the magnitude of this situation. The carriers’ own reservation lines average a 20 minute hold on a good day.

Can you imagine the lines at the ticket counters? One call to your agent will be able to tell you exactly what is available and when. But more importantly, your agent can re-ticket you immediately. (Please don’t ask us to “fix” an Orbitz record or one that was done elsewhere-we have no access to that information for your protection and security.)

So, listen up – do not book online, do not book too far in advance, use your credit card, purchase insurance if it is feasible, prepare for the worst, and be sure to keep your travel professional’s business card handy. You may want to look into redeeming some of those miles as well.

I think everyone is safe for the rest of the year. The lucrative holiday period is approaching. But no matter who and when, it will be a mess and the impact will be felt worldwide.

While it may very well be the end of an airline, it is not the end of the world. It will take some time to sort it all out, but with a dose of patience, a pinch of manners-no make that a heap of manners-and a clear head, we will get through this mess.

Who will be the first? Who knows?

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