Trump admin ditches Biden-era plan to make airlines pay compensation for flight disruptions

Key Points

• The Trump administration has scrapped a Biden-era plan that would have mandated airlines to provide compensation such as cash, lodging, and meals for flight disruptions caused by the carrier.
• The proposed rule aimed to enhance U.S. airline consumer protections to be more in line with European standards, introducing compensation based on the nature and duration of disruptions.
• Industry group Airlines for America opposed the rule, claiming it would have resulted in higher ticket prices, and expressed support for the current administration's review of regulations it deemed unnecessary.
• The Biden administration's considerations included free rebooking and assistance for stranded passengers, which many major airlines already provide informally.

The Trump administration said Thursday it is abandoning a Biden-era plan that sought to require airlines to compensate stranded passengers with cash, lodging and meals for flight cancellations or changes caused by a carrier.

The proposed rule would have aligned U.S. policy more closely with European airline consumer protections. It was proposed last December in the final weeks of then-President Joe Biden's administration, leaving its fate in the hands of his Republican successor.

In a document posted Thursday, President Donald Trump's Transportation Department said its plan to scrap the proposed rule is “consistent with Department and administration priorities.” Trump has sought to significantly roll back or modify federal regulations that his administration deems are wasteful or burdensome.

Industry trade group Airlines for America, which represents carriers including United, Delta and Southwest Airlines, welcomed the move by the Trump administration.

“We are encouraged by this Department of Transportation reviewing unnecessary and burdensome regulations that exceed its authority and don’t solve issues important to our customers," the group said Thursday in a statement.

Airlines already offer some level of customer service when they cause flight cancellations or severe delays, but passengers usually have to ask for help at the airport, and airline promises don’t carry the weight of federal rules.

But the proposed rule sought compensation starting at $200 when a flight is canceled or significantly delayed because of a mechanical problem with the plane or an airline computer outage. Compensation as high as $775 was proposed for delays of nine hours or more.

Carriers fiercely opposed it. In a public comment submitted this summer, Spirit Airlines said the rule threatened to increase operating costs for airlines and drive up ticket prices for passengers.

The budget carrier filed for Chapter 11 bankruptcy protection last week for the second time in a year. Spirit quickly followed that announcement with news that it planned to suspend operations next month in about a dozen cities.

“There is no free lunch,” Spirit said. “If every time a flight has to be cancelled due to, say, an aircraft maintenance issue, airlines were required to pay each affected passenger $300 plus hotel and meals, there would be a perverse incentive to cancel flights preemptively at any hint of trouble.”

Biden's Transportation Department was also considering free rebooking on the next available flight, including flights on rival airlines, as well as meals and lodging when passengers are stranded overnight.