DOT Regulations Governing Air Passenger Rights during Periods of Airline Delay

In late 2007, the United States Department of Transportation (USDOT) began the process of preparing new regulations to ensure certain consumer protections pertaining to airline tarmac delays. We were engaged by USDOT to prepare a regulatory impact analysis (RIA). The RIA was to provide an in-depth analysis of the likely costs and benefits to passengers, carriers and society.

We drew from key tenets of transportation economic theory and applied evidence-based findings on the value of traveler time and preferences. We were able to value passenger discomfort of waiting in planes on the tarmac for extended periods versus spending that time in the terminal, and when experiencing uncertainty regarding arrival delays, among other concerns.

Our analysis determined that the benefits to airline passengers of the new rule will exceed the costs to airlines of implementing it by more than $60 million over the first 20 years. The Final Rule took effect in the first half of 2010.