Business Maverick

Business Maverick, South Africa

Do airlines have a problem with overbooking flights?

9 Jan 2025

The FlySafair furore has put the spotlight on overbooking, which is a common practice for airlines in South Africa and around the world. FlySafair is now facing an investigation from South Africa’s consumer watchdog.

FlySafair sparked anger last week after admitting on X (formerly Twitter) that it overbooks flights — essentially selling more tickets than there are available seats on a flight.

The overbooking practice can leave passengers stranded and cause enormous financial pressures, especially if they don’t check in early before their paid-for flight departs. This happened to Thato Miles Nsala, a FlySafair passenger, who complained on X on Sunday, 5 January 2025, that he couldn’t board a flight after being informed there were no seats available on his booked flight.

So we show up at the airport and @FlySafair says we don’t have seats for the same flight we paid for.
If you have 200 seats why take payments for 300 passengers ?????

— Thato Miles Nsala (@Miles_Nsala) January 5, 2025

In response, FlySafair admitted to overbooking the flight and justified the practice.

The airline’s response caused widespread outrage, with hundreds of customers detailing the inconvenience of being booted out of overbooked flights. Now the National Consumer Commission, a watchdog for consumers, has entered the fray, confirming that it is investigating FlySafair’s overbooking practices. Daily Maverick takes a look at how big a problem overbooking is for local airlines.

What is overbooking and why do airlines engage in this practice?

Overbooking is a common practice for airlines in South Africa and around the world. As part of their aviation operations, airlines sell too many tickets with the assumption that there will be a certain percentage of “no shows” — either because people miss their flight, their connecting flight is delayed, or they have a change of travel plans. The reason behind the overbooking practice is a commercial one as airlines try to fill their planes up as much as possible, or to essentially get bums on seats.

Chris Goater, head of corporate communications at the International Air Transport Association (an industry body), said overbooking was a practice that also benefited passengers as it allowed airlines to lower the cost of travel.

“Flying with empty seats benefits no one, whereas allowing airlines to overbook flights creates more choice and cheaper fares for consumers, and allows carriers to better manage revenue. It is a long-established and well- managed industry practice all over the world. And the busier the plane, the more efficiently people fly, lowering the emissions per individual traveler,” said Goater.

He said overbooking was not a systemic problem in Africa because airlines in the continent could fill up planes with passengers, helping them to manage costs better and to be profitable. Underscoring this was a metric called a load factor, which referred to the percentage of available seats on a flight filled with passengers. It was an indicator of how efficiently an airline was using its seats.

Goater said African airlines had been working hard to improve their load factors, as seen in their average load factor in 2024 reaching about 74%, compared to a global average of nearly 84%. A higher load factor meant the airline was filling more seats.

How often are passengers denied boarding a flight as a result of overbooking?

According to FlySafair, it overbooks flights to a maximum of about 1% of the total seating capacity. A FlySafair plane typically has a seating capacity of 189. So, FlySafair said it would overbook a plane of this size by “no more than two seats”. The number of people actually denied boarding is relatively tiny. FlySafair said that over the past 10 months, data shows that only “0.0006% of customers were denied boarding due to overbooking”.

South Africa doesn’t have reliable data on the number of people denied boarding. Most aviation players reference trends in the US, which provide the best statistics on this matter. The number of people denied boarding by the largest US airlines — both voluntary and involuntary — was 1.07 million in 1999, but this number declined to approximately 333,000 in 2023, according to the Bureau of Transportation Statistics. Those might sound like large numbers but the 2023 level represented less than 1% of trips taken by passengers.

How do airlines decide which passengers are bumped off a flight?

Airlines encourage passengers to check in early (especially online), hours before their flight departure. The policy for most airlines is that the check-in process is on a first-come-first-served basis. The last passenger(s) to check in are those who will be denied boarding if the flight is overbooked.

If all passengers arrive for the flight, many airlines offer a cash incentive for passengers who are not in a hurry to take the next flight. These passengers would volunteer to take a later flight in return for compensation. Even passengers involuntarily bumped off a flight are compensated.

FlySafair’s policy is to offer passengers R1,000 in cash as compensation, and the choice of a seat on the next available flight at no charge, or a full refund. Other local airlines including Airlink, South African Airways, and Lift also overbook their flights and offer similar compensation mechanisms.

Laws and regulations in the US are strict, especially if passengers are denied boarding involuntarily. US Department of Transportation regulations require airlines to compensate passengers up to $775 (about R14,725), for domestic flights and up to $1,550 (about R29 400) for international flights. Airlines in the US also have to give passengers meal vouchers and even pay for their accommodation if they are delayed at an airport overnight. In the European Union, similar rules apply.

Are airlines in South Africa violating any laws by overbooking?

In South Africa, there is no specific airline legislation covering the industry and its overbooking practice. However, airlines are bound by the provisions of the Consumer Protection Act. Aviation analyst Guy Leitch said the act seemed to permit overbooking, and that airlines had adopted their own policies around that.

Kirby Gordon, FlySafair’s chief marketing officer, told Daily Maverick that airlines in South Africa tend to follow section 47 of the act, which speaks to overbooking generally and mentions no industry, but sets the terms for compensating consumers.

“While no specific monetary values are stipulated for compensation, the law does outline that the consumer must be refunded if the goods or services are not supplied and compensated. It also has a section that says that the supplier has a defence against any claims from the consumer if they supplied, or got another party to supply comparable goods or services,” he said Gordon.

Are there airline players in South Africa that are against overbooking flights?

Yes. Airlink, a domestic and regional airline, is against the overbooking practice. Airlink CEO Rodger Foster told Daily Maverick that the airline’s decision was informed by its obligations in terms of the act and consequences involved for overbooking and overselling.

Airlink has taken a different approach and manages this risk by applying a strict no-show policy instead. For example, if a passenger does not show up for their flight (or alert the airline no less than an hour prior to departure), they will forfeit their ticket in its entirety,” said Foster.

He said “no-show rates” varied according to route, time, and the date of travel.

Why is the National Consumer Commission investigating the practice of airlines overbooking flights?

Investigations by the commission are usually based on complaints received. However, in a statement issued on Thursday, the NCC said the investigation had been prompted by “concerns in the media, including social media, regarding allegations of FlySafair overbooking and/or overselling practices”.

The commission will investigate whether FlySafair’s overbooking practice and compensation mechanisms are in line with the Consumer Protection Act or if the airline violated it. Violations tof the act carry sanctions including monetary fines of R1-million or 10% of annual turnover — whichever is greater.

What is FlySafair’s response to the National Consumer Commission investigation?

FlySafair said overbooking was not unique to the airline as it was a globally accepted practice employed by airlines to “manage operations efficiently, mitigate the financial impact of no-show passengers, and keep air travel affordable”. The airline said it shouldn’t be singled out by the commission because the overbooking practice had been used by all local airlines, past and present, as well as international carriers selling tickets to South African consumers. DM

This article has been updated to include comments from Airlink and the International Air Transport Association.

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