← Back to blog

Overbooking of Airlines: a quick guide for your business travel processes

2 Mar 2021

Brought to you by TravelPerk, the #1 business travel platform.

Overbooking of Airlines: a quick guide for your business travel processes

You’ve just settled into your seat. The armrests are down, and the window blind is up, almost ready for take-off. All of a sudden, the air steward’s voice fills the cabin—they’re apologetically asking for volunteers to offboard. Your flight, like so many others, has been overbooked. 

Times like these might leave you and the passengers around you questioning why the airline would sell more tickets than it has available seats. It seems counterintuitive. However, there’s a logical explanation for airlines running oversold flights.

Whether it’s limiting losses or keeping airfares low, overselling tickets is common practice with many airlines. Here’s all the info you need to help you avoid getting bumped from your flight, as well as what compensation you deserve in the unfortunate case that you do.

What is airline overbooking?

Overbooking is an airline’s way of ensuring they have no empty seats at take off. It’s exactly what it sounds like—an airline sells more tickets than they have seats on the plane. They do this to ensure a full plane when it comes to take-off. Empty seats are a financial drain on airlines.

Travel experts warn that around 150 tickets are sold for every 100 seats available, so you’ve undoubtedly been on an overbooked flight. British Airways admits to overselling 500,000 seats in a single year, leading to 24,000 passengers having to be bumped from flights. 

Why do airlines overbook?

The simple answer to why airlines overbook is to maximize profit. Airlines want to avoid empty seats at all costs, and overselling tickets is a great way to do just that. The logic is understandable considering the statistical likelihood of all passengers with a valid ticket checking in on time is less than 1 in 10,000.

There are many reasons why an airline oversells tickets. The first is that passengers often simply don’t show up for their flights, and they don’t bother to cancel. These individuals are known as ’no-shows’ in the aviation industry. 

Another reason tickets are oversold is because airlines expect a percentage of people to be coming from connecting flights—flights that could very possibly be delayed or canceled. A 20-minute delay on the first flight could be the difference between boarding and not boarding the connecting flight in many cases.

Yes, overbooking is entirely legal. Airlines are subject to regulations, which we’ll detail shortly, but given these regulations are followed, overbooking is a completely legal practice. 

In fact, if overbooking were to be made illegal, the price of air travel tickets would likely increase. Overbooking helps airlines guarantee their planes will be filled to capacity, allowing them to keep tickets cheap.

Overbooking can go wrong, however, when passengers refuse to be bumped. While most airlines aim to solve overbooking issues before passengers begin to board, there are cases where passengers must be removed from flights.

This was the case on a 2017 United Airlines flight from Chicago to Louisville. An old man was forcibly removed from the flight in front of the remaining passengers. It was distressing for everyone involved—and incredibly bad press for United Airlines. Not illegal, but really not a good way to show passengers you care.

How do airlines determine how to overbook flights?

The extent to which plane tickets are oversold is based on extensive air travel statistical research. Airlines invest in creating huge databases of previous passenger trends and past no-shows. These calculations are not foolproof, however, and can lead to passengers being bumped to different flights.

For example, if the data on flights from Barcelona to New York shows that an average of five passengers doesn’t show up, the airline oversells by five tickets. All this work is done by a computer though, so no getting angry at the air steward if it’s you that’s got to bid hasta la vista to your ETA.

What happens if your flight is overbooked?

When the statistics and algorithms do get it wrong, airlines have several options to work their way through. 

Initially, they’ll ask for volunteers to be bumped to a later flight. These volunteers must receive compensation, as per EU regulations, in the event of denied boarding. Passengers flying to and from the United States are also covered by the U.S. Department of Transportation’s regulations on oversold flights, so make sure to check which regulations apply.

How much compensation do airlines offer for overbooking?

The compensation received in the case of overbooking depends on the distance of the flights and can be claimed up to six years after the incident. Airlines may try and offer vouchers and a hotel room while you wait. However, they’re legally obligated to provide cash. Compensation is awarded as follows:

  1. 250€ for all flights of 1,500km or less.
  2. 400€ for all domestic flights of more than 1,500km and for all other flights between 1,500km and 3,000km.
  3. 600€ for all flights not falling under points one or two.

Not the worst deal if you’ve got no pressing matters waiting for you in your final destination. If no volunteers or not enough volunteers come forward, airlines are forced to remove passengers involuntarily. The decision on who gets bumped from a flight is made via a multitude of different methods.

How do airlines decide who gets bumped from overbooked flights?

Although there’s no exact science, it’s often the lowest fares that get bumped to the next flight first. This means those flying business class or first class are highly unlikely to be denied boarding in the case of overbooking. 

Airlines have also admitted to bumping people based on the time of check-in—arriving last minute is not recommended. Each airline should detail their overbooking policy in their contract of carriage, so make sure to check yours before heading to the airport.

Certain groups are less likely to be bumped due to overbooking. Frequent flyers, the elderly, and families with young children are all unlikely to be denied boarding, as are people with disabilities and unaccompanied minors. Some airlines claim passengers are bumped according to a computer program. However, belonging to one of these groups will likely improve your chances of taking off.

Business travelers, who are often traveling on tight schedules to get from A to B, are not exempt from being bumped from flights. That’s why it’s a good idea to use a travel management company—they’ll support you when things go wrong. 

TravelPerk offers flexible business travel that allows you to cancel whenever without losing what you paid for the ticket. It’s called FlexiPerk, and it saves you 40% more on average than traditional flexible fares—a huge benefit considering 2020. 

Alongside the flexible travel, you also have access to TravelPerk’s dedicated 24/7 customer support where you’ll be attended by a real person, not a bot!

How to avoid being bumped from an overbooked flight?

The best strategy to avoid getting bumped from flights comes from understanding how airlines bump passengers. Although there’s no guarantee you won’t be bumped, there are steps you can take to minimize your chances, such as:

  1. Check-in to your confirmed reservation early, in case your airline decides to use the first come first served approach to bumping passengers, you’re likely in the clear. 
  2. Choose your seat if you’re offered the chance. An oversold flight is unlikely to have seats available at check-in, and those with seat allocations are less likely to become bumped passengers.

Wrapping up

Although overbooking is super common, the number of people ultimately denied boarding is relatively minuscule. There’s no sure-fire way to guarantee you’re never bumped from a flight, but there are certainly steps you can take to limit your possibilities.

Airlines overselling tickets definitely feels like an illegal practice, but ultimately it’s keeping airfares cheaper than if overbooking didn’t exist. 

Despite this, having fewer seats than there are passengers is never desired by airlines. Travel vouchers, hotel rooms, and cash compensation only go so far when an airline’s got a reputation for overbooking flights.

Travel hasn’t exactly been easy over recent years; however, knowing your rights when things go wrong is essential—regardless of a certain pandemic. Business travel is undoubtedly on the return, and we all need to navigate a new normal. Travel will certainly look very different to before, and knowing your updated travel rights is the first step to prepare for this evolving era of travel. 

Now you know where you stand when it comes to oversold flights; however, we hope it doesn’t come to that. For now, sit down, buckle up, and prepare for take-off—happy traveling!