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Bad news for fliers? American, Delta to end 'interline' pact

Ben Mutzabaugh
USA TODAY
This file photo shows Delta Air Lines and American Airlines aircraft at Washington's Reagan National Airport.

American and Delta are ending a longstanding "interline" agreement that allows them to easily put passengers on each other's flights.

"We have been unable to come to terms on an agreement with Delta and, as a result, have mutually agreed to end our interline agreement effective Sept. 15," American Airlines spokesman Casey Norton says in a statement to Today in the Sky. No further negotiations are currently planned.

In its own statement, Delta indicated that the sticking point was an imbalance in passengers needing to be rebooked during irregular operations -- or IROPS, in airline parlance.

"Unfortunately, we couldn't reach an agreement with American that adequately addressed the number of IROPs customers that American transferred to us,” Eric Phillips, Delta's SVP – Revenue Management, says in a statement. “In July, for example, American sent passengers to Delta for reaccommodation at a five-to-one ratio."

The story was first reported by The Dallas Morning News.

An interline agreement is the most basic passenger-sharing arrangement between airlines. They're less involved than "codeshare" pacts, in which airlines are able to market connecting itineraries and offer reciprocal frequent-flier benefits on multi-carrier trips.

But interline pacts do allow carriers to reserve seats with their interline partners. For fliers, the most obvious benefit is that the agreements allow passengers to connect from one airline to the other while traveling on a single ticket. Passengers flying on airlines that do not have an interline agreement typically must buy separate tickets and check bags individually with each carrier in the itinerary. Interline agreements also allow airlines to send fliers over to one of their interline partners during poor weather or other irregular operations.

Most big "traditional" airlines in the U.S. and across the world have interline agreements with each other.

American addressed the change in a memo to workers. The Morning News obtained a copy of that memo.

"Interline agreements are common across the industry and they generally include a standard, discounted rate for calculating how much is owed by one carrier to another to use their seats during irregular operations," AA says in the memo, according to the Morning News.

"In April of this year, participating airlines across the industry agreed to new rates for moving customers between carriers during irregular operations," AA continues in the memo, as quoted by the Morning News. "Delta recently decided to go outside of that joint agreement and negotiate an individual agreement with American. We have been unable to come to terms on an agreement with Delta and, as a result, have mutually agreed to end our interline agreement effective September 15."

Phillips, Delta's revenue management executive, referred to the "5-to-1" irregular re accommodation ratio for irregular operations in July. "At that rate the industry agreement was no longer mutually beneficial," he said in Delta's statement.

American acknowledged that the end of the deal could have implications on how it handles customers in certain situations.

"(N)either airline will offer interline services to each other, including the ability to rebook passengers at discounted rates on the other carrier when flight disruptions occur," AA spokesman Norton adds in the company's statement to Today in the Sky.

"While this is a change, it will not affect our commitment to reaccommodate customers during irregular operations," the statement continues. "The new American now has the world's largest and best network and our team is doing a great job of running a reliable airline. With nine hubs and gateways and nearly 7,000 daily flights, we have more ability to re-route our customers during operational disruption than any other airline in the world."

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