Qantas cannot guarantee flights
"Qantas cannot guarantee flights," says the airline as it launches its defense in the ACCC "ghost flights" case Business reporter Nassim Hadem Published 9 hours ago, updated 3 hours ago
Qantas may face fines of hundreds of millions of dollars if found guilty of misleading customers by advertising thousands of "ghost flights" - flights that had already been canceled. However, the airline has begun its legal defense, claiming that its actions were reasonable.
The Australian Competition and Consumer Commission (ACCC) alleges that Qantas sold tickets for over 8000 "ghost flights" that it had already canceled.
Qantas has filed its defense in the Federal Court.
In a statement to the media, Qantas stated that while it "fully acknowledges that it let customers down during the post-COVID restart, including due to high cancellation rates," and "while mistakes were made, the ACCC's case ignores the realities of the aviation industry - airlines cannot guarantee specific flight times."
It goes on to say that all customers of canceled flights were offered an alternative flight or a refund, and "no service fees" were charged.
"As we have stated from the beginning of this matter, we fully acknowledge that the period ACCC is looking at was an extremely challenging one for our customers," the airline said.
"The restart of flights after the COVID-19 shutdown was challenging for the entire industry, with staff shortages and supply chain issues coinciding with huge pent-up demand.
"As a result, Qantas canceled thousands of flights, and there were many unacceptable delays. While we successfully restarted aircraft, we made many other mistakes, and for that, we sincerely apologized."
The statement claims that from a legal perspective, the ACCC's case "ignores the fundamental reality and key condition that applies when airlines sell tickets."
"While all airlines make every effort to operate flights as scheduled, no airline can guarantee this. This is because the nature of travel - where weather and operational issues mean that delays and cancellations are inevitable - makes such a guarantee impossible."
The statement says this is backed up on the ACCC's own website.
"For this reason, we promise that customers will be able to get to their destination as close to their booked flight time as possible, either on the original or an alternative service at no extra cost," the airline said.
"Otherwise, we offer a full refund. This aligns with our commitments under consumer protection laws, and it's exactly what we were doing during the ACCC's review period."
Summary of ACCC's allegations against Qantas ACCC, led by Chair Gina Cass-Gottlieb, claims that Qantas canceled some flights that were scheduled to depart from May 1, 2022, to July 31, 2022, and that the airline continued to sell tickets on its website on average more than two weeks and in some cases up to 47 days after the flights were canceled. This amounts to 8000 ghost flights.
ACCC also alleges that Qantas did not notify existing ticket holders of the cancellation of more than 10,000 flights scheduled from May to July 2022, on average 18 days and in some cases up to 48 days.
ACCC claims that Qantas did not update its 'Manage Booking' webpage to reflect the cancellations. It says that such conduct affected a significant portion of Qantas flights canceled during the May to July 2022 period.
The company provides several examples in its press release, and in a statement to the Federal Court, ACCC lawyers stated: "As a result of Qantas' conduct, consumers may have made decisions to purchase airline tickets based on false or misleading information. As a result of these decisions, some Qantas customers may have suffered losses, as they arranged trips or other events based on the expected flight schedule."
It added, "Consumers who relied on the flight information on the 'Manage Booking' webpage had less time to consider alternative travel arrangements, and some may have incurred greater costs for alternative travel arrangements once they became aware of the cancellation of their flight.
"Some consumers may also have paid a higher fare for a flight at a particular selected time and may not have done so, or may have sought to travel at a different time or date or with an alternative airline if they knew that the flight they paid for had already been canceled."
Qantas admits mistakes: Qantas
Qantas states that in the cases of cancellations mentioned in the ACCC press release, "100 percent of affected domestic passengers were offered flights on the same day departing before or within one hour of the scheduled departure time," and that "98 percent of affected international passengers" were offered re-accommodation options within 24 hours of their originally planned departure date.
"In most cases, customers were rebooked on these alternative flights several weeks or months before they were actually due to travel, allowing them to plan," the statement says.
It states that the ACCC's case pertains to canceled flights that remained on sale for more than 48 hours.
"We acknowledge there were delays, and we sincerely regret that this occurred, but, importantly, it does not mean that Qantas received a 'no-service payment' because customers were re-accommodated on alternative flights, as close as possible to their original time, or offered a full refund," Qantas added.
"Qantas did not delay communication with our passengers for commercial gain. We also did not cancel flights to protect slots, especially considering that at the time, slot waivers were in place at most airports."
The airline mentions that the primary reasons for the delays were "providing our teams time to create alternative travel options for customers during times of mass disruptions to avoid further wait times at the call center; and, in cases of longer delays, some human errors."
It states that the post-COVID reboot period "was deeply disappointing and frustrating for customers and challenging for our staff."
"Mistakes were made. While we hope this level of disruption will never happen again, we have strengthened our systems and processes to ensure it does not happen again," it added.
The airline also rejects the idea of selling "ghost flights," stating that people who paid for a flight were either provided with a flight or refunded, and again, this was not a case of a "no-service payment."
The statement mentions that Qantas canceled thousands of flights during this period, as in the first half of 2022, the airline faced difficulties due to supply shortages, which meant that aircraft flights were suspended. It also states that "a significant increase in sick leave and self-isolation requirements led to staff shortages," and that "some international borders were still changing."
"To stabilize our operations, we made the decision to significantly reduce scheduled flights," the airline said.
"This meant canceling many flights that were already in the system, which we did on average two and a half months before the scheduled departure, so that we could better control the impact on customers by finding alternatives for them.
"But this also meant that the volume of changes was enormous, and our systems struggled."
The statement says that Qantas had to process more than 415,000 route changes in February and March 2022 alone, and in most cases, the delays between Qantas deciding to cancel a flight and notifying customers gave Qantas time to find alternatives.
"This happened months before they were due to travel, and our priority is always to find alternatives within hours or days of their original departure time, prioritizing those closest to their travel date," Qantas said.
Why not cancel flights and then rebook tickets for customers? Regarding whether the airline could have informed customers that their flight was initially canceled and then later offered an alternative flight, the airline states that "in the case of the cancellations under consideration, when flights were scheduled far in the future, we believe it would have caused significantly more disappointment to customers."
"If we sent thousands of customers weekly messages saying their flights were canceled and provided them with alternative flight options, we would create a lot of unnecessary uncertainty for these customers and further increase call center wait times," the statement says.
"Instead, we waited for the opportunity to inform customers: 'Your flight has changed,' rather than 'Your flight has been canceled.'"
It reiterated that flights were left on sale not for financial gain but due to systemic constraints and the sheer number of flights involved, preventing them from automatically withdrawing these flights from sale while simultaneously providing affected customers with alternative flights.
"While managing this is not an issue in 'normal times,' the scale of changes we faced during this period meant that some flights, as the ACCC case shows, remained on sale for 48 hours or more after their cancellation," the statement said.
"Some of the longer delays were caused by human errors and process failures. We do not blame our staff for these processing errors, given the incredible challenges they were dealing with.
"This was not done for commercial gain. All customers who booked a canceled flight were offered an alternative flight as close to the scheduled time as possible at no additional cost or a full refund."