Would someone please tell American Airlines to stop its deceptive “hold” policy for tickets?


Another day, another person duped by American’s 24-hour “hold” policy.

What’s American’s deceptive “hold” policy? I’ll explain in a minute.

But the case opens a much bigger door. It begs the question: Did the government, in an effort to accommodate the airline industry, offer an enormous loophole that is allowing companies to dupe their customers? And is it time to close that loophole or to simply accept it?

But first things first. American gives you two options when you book a ticket. You can pay for it or “hold” it for 24 hours.

Under the Transportation Department’s 24-hour rule, implemented in 2013, it must either “hold” for 24 hours or offer a refund within 24 hours of purchase, with certain exceptions.

Most domestic carriers went with door number two — refund within 24 hours. Except American.

And that’s where today’s case starts. It comes to us by way of Bennetta Anderson.

“I purchased a ticket from American,” she says. “I tried to get a refund almost immediately. However, due to their almost-hidden hold policy I could not.”

Almost hidden? Well, yeah. This is a lot like baggage fees in 2009. Only one or two airlines had them, so a lot of people assumed — incorrectly, it turns out — that their luggage flew “free.” They were wrong.


“I realize this is their policy, but as every other U.S. airline offers the 24-hour refund, and their hold policy is not explained on the purchase page, I still feel cheated,” she says.

She wants me to fix this.

I’ve tried.

I’ve sat across from two American Airlines VPs and told them point blank that this policy is bad for customers. They disagreed.

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They insisted customers “like” the flexibility of being able to hold a ticket for 24 hours without having to pay anything. I can’t disagree with that, but how many people actually book the ticket, assuming they can get a 24-hour refund, which is the industry standard policy?

I can answer that: Too many.

So here’s what needs to happen. Instead of going after American for one refund, I can either accept this unintentional consequence of a government trying to accommodate the airline industry, or I can step up and ask the DOT to close this loophole permanently.

I don’t see any prominent advocates calling for an end to this. But I promise, there are thousands, perhaps tens of thousands, of American passengers who feel deceived by its practice of saying, “Oh, we’re sorry, your ticket isn’t refundable — but you could have held it if you wanted to.” (Or if they’d prominently disclosed this option.)

American had a chance to do the right thing when it harmonized its policies with US Airways. It decided that this customer-unfriendly policy would serve it best, and I have no doubt that it has. But it made the wrong call.

Should I advocate for American to change its 24-hour "hold" to conform with the industry standard?

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Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or check out his adventures on his family adventure travel site. Contact him at chris@elliott.org.

  • backprop

    I like American’s policy way, way better than the other airlines’. It’s much easier to set aside flights as I’m piecing together potential trip days with multiple moving parts, and NOT get the credit card involved or try to deal with refunds later.

    And it isn’t deceptive in the least. And the ability to hold IS prominent, in the form of a button right next to the “Buy” button.

    Outrageous headline.

  • Joe_D_Messina

    I don’t fly American and wasn’t aware of this policy but the article leaves me confused. If there is no charge in the first 24 hours which is what the article says the “convenience” is of this policy then why was the OP needing a refund? Wouldn’t they just have been canceling the reservation without any money having actually changed hands? Was there a hold for the amount of the ticket put on the credit card but not actually officially charged? Can somebody fill in the blanks?

  • backprop

    With AA, you pick your flight, see the price, even pick your seats if that’s an option… Then you’re presented the option to either (a) buy that flight or (b) to set it aside for 24 hours (often more since it goes to midnight of the next day) and buy it later, with no obligation; if you don’t do anything the hold simply expires and you aren’t charged.

    AA flyers often point out this policy as a favorite feature of AA vs. other airlines and I agree.

  • The Travel Geek

    I got tripped up b this policy last month, but fortunately for my status with AA (Platinum) and a call center supervisor with an actual soul accepting my argument that I had cancelled the flight booking within ten minutes of making it because I had been a long-time US client, I did not know of this policy (as US had the “cancel within 24 hours” policy), so they gave me a waiver. Personally, I think the policy is atrocious for the client and wish that they had the policy that UA has (or at least HAD when US was still in the Star Alliance), whereby you could pay a legitimate fee and hold the fare for (I think) a week. In this scenario under AA, if you make even the slightest error while booking and then realize it 20 seconds after you purchase it, you are SCREWED and have to pay a massive change fee! And the more I think on it, the more I think this is the reason AA has implemented the policy! Quite short-sighted if you ask me!
    And, by the way, when I mentioned this to a Facebook community I belong to that is filled with business travelers (who are usually VERY on top of what is happening the industry with all the policy changes), it was staggering just how many AA flyers did NOT know of this! Heck, it took me about seven minutes on the phone with a AA rep to find the option to reserve the fare! Again – very short-sighted!

  • Joe_D_Messina

    Thanks for the clarification. So, the OP actually purchased the ticket outright and couldn’t get a refund because she didn’t select the hold option? They don’t offer refunds at all unless you go with the hold option?

  • backprop

    Correct, but just to be clear, the hold option is a hold. You aren’t charged and if you cancel it or let it expire, there is no need for a refund because a charge never took place to begin with.

    The DOT’s ruling allows for either, and IMO the hold is much more user friendly. A cynic might ask, if hold is so bad for consumers and good for the airlines, why does only one airline offer it? :)

  • backprop

    My advice: always put it on hold first. Firm up plans, double check numbers, and then buy. It’s like two extra clicks.

    There are so many situations where a hold is much easier to manage, especially if you’re piecing together a complex trip.

  • AMA

    I like American’s hold policy. It gives you a chance to change your mind without having to go through all the “refund” hoops!! I think every airline should do this.

  • backprop

    What do you think the DOT would have done, seeing as how they allow both options explicitly?

    https://www.transportation.gov/affairs/2012/dot0812.html

  • KennyG

    So I am quite confused. Usually you want the government to create rules and regulations to protect everyone from the big bad companies out there, yet when the government did just that [in this particular case], and then the “unintended” consequences make it so a few people who can’t/won’t bother reading the terms and conditions are aggrieved, you blame the company for following those same regulations you advocate so vigorously for. Maybe we should just get the government out of most private businesses and let the free market system work itself out, which it usually does. Just one mans opinion.

  • MarkKelling

    What refund “hoops”?

    When you purchase an airline ticket on any airline based in the US other than AA and you cancel it within 24 hours of purchase, the money is refunded to you. That’s it. No forms to fill out, no phone calls to make, no special dispensations, no waiting on decisions from the airline’s refund department. I see the refund in my card account usually within the next 36 hours, sometimes sooner, and in many cases the charge never posts to the account anyway since it is within 24 hours that I cancel. Yes, there can be a pending hold on your available balance on the card used to purchase the ticket.

  • MarkKelling

    Well, the hold option is not pointed out on the purchase page very clearly as an option. For someone who is not a frequent purchaser of AA tickets, it is very easy to miss.

    There is a line of buttons listed under a Payment heading to click on which go: Credit/Debit, Pay later (some kind of financing option I didnt explore), Pay Pall, Gift Certificates, Vouchers, and then finally Hold. Nowhere, NOWHERE, on the page is there any indication that you should select HOLD if you are uncertain about your travel plans. That may be noted elsewhere on the AA web site, but not at the point where you actually select your payment option. What may be confusing here is other airlines offer a HOLD option where you can hold the ticket for 7 days or more for a small fee. AA also offers that when you click on the HOLD button in addition to the 24 hour hold.

  • MarkKelling

    The issue is that AA is the only airline anywhere that uses this option and it does not clearly indicate you CAN’T get a 24 hour refund when you are making your purchase.

    Since AA has very powerful friends in the government, I wouldn’t be surprised if this option was added just for them.

  • backprop

    I had a situation. I was finalizing a business class trip to Australia. I had two separate round trip options that I put on hold on AA so I could finalize tour plans over the next day. That was so helpful. Had I not had the hold option, I don’t think I could have put both itineraries on my credit card within the credit limit.

  • KennyG

    So where is AA doing something that was not allowed in the government regulations that were put into place? Perhaps your “anger” at American Airlines should be redirected to the legislators in DC that passed the law and language that AA has implemented. To me it is just another example of “be careful what you wish for, you may actually get it”. Unintended or intended consequences. As you can see from some of the comments here, many folks like the way AA has implemented this though.

  • backprop

    I can’t imagine it being much clearer.

  • Flywisely

    Have you guys read this?
    http://qz.com/541572/a-pricing-glitch-means-american-airlines-is-on-the-hook-for-more-than-1-million/

    However, in an agreement today (Nov. 4) with the DOT to avoid further legal action, American says those whose reservations were canceled will be offered a free economy class ticket or a $1,500 discount on a business class ticket.

    AA is providing some “protection” for mistake fares on hold! You don’t even need a credit card to put an itinerary on hold. This is a lot better than a 24 hr refund.

  • MarkKelling

    Glad it works for you.

    On UA I have the option of holding any ticket. It costs about $7 or so for a 7 day hold and the full ticket price is not charged. While not free, it works for me. But then I usually am sure of my flight options and have no need for a hold.

  • backprop

    I can’t imagine it being too much clearer.

  • backprop

    (image)

  • MarkKelling

    I can understand the position of AA on the hold vs refund. But I don’t agree with it.

    It costs AA (and every other merchant as well) when they post a purchase. It costs them again to refund that purchase. By using the internal hold option, the airline is saving money that they would be required to pay to the credit card networks. While that is only a couple pennies per ticket, it can add up to a significant amount during travel periods where lots of churn occurs. Like spring break and holidays.

    The hold option can also be beneficial to their customers because there is no hold on funds in their credit or debit card account for the refunded purchase. It allows you to hold multiple itineraries while working out the details of your trip without tying up significant amounts of your credit line, as noted in another reply, and requires no further effort to cancel the options you chose not to purchase and use.

    However, the hold option does have drawbacks.

    AA does not clearly note on the purchase page that your only option with them is the hold and the 24 hour refund option is not available. This must create a huge income potential for the airline from first time or infrequent flyers who are not aware of this unique option and pay for tickets thinking the refund is possible. Then these purchasers get stuck paying change fees. The hold option must cause incredible churn in their reservation system. Nothing stops a customer from putting a seat on every flight on hold. IF enough do that, people who actually want to buy a seat may not see anything available and buy a ticket on another airline. AA would not be doing this if there was not a clear boost to their income.

    While most customers will only get hit with this once, I feel it is not a customer friendly approach. I also have nothing against any business choosing options that are contrary to the practices of all their competitors, but just clearly spell it out that you are choosing to go contrary to the rest of the world.

  • backprop

    And as many of us are pointing out, many prefer AA’s method. Other than some people confused that AA is the only one to offer a hold, nobody has really put forward a substantive arguments as to why a cancellation policy is better than a free hold.

    That considered, why is it AA that has “powerful friends in government” pulling strings?

    If a hold (vs. a refund window) is so good for airlines’ business and so bad for the consumer, then why aren’t all airlines doing it? That’s the dim view of change fees, baggage fees, seating policies, etc. regularly taken on this blog.

  • MarkKelling

    I have no anger at the airline. I have only flown AA once. Didn’t like a lot of things about the experience and have never flown them again. Other airlines provide me with what I need. It is possible that what I don’t like about them is what brings everyone else back as repeat customers.

  • I find no confusion on the AA website about this. Could you point out to me the airlines that spell out the refund option on their purchase page? I didn’t think so.
    Here’s what you need to do – get DOT to standardize on the 24-hour hold option – less personally identifiable information is then transmitted over the net as your credit card numbers aren’t sent until the final decision to buy is arrived at. Better for all involved.

  • MarkKelling

    Yes, if you are a frequent purchaser of AA tickets, you know their system and are apparently happy with it.

    IF AA would more clearly indicate that a customer should choose the hold option in place of the purchase option I think the argument would be resolved.

    There are multiple exapmles of AA getting its way in the government through the years. Remember the Wright Amendment and the attempt to shut down Dallas Love field?

  • MarkKelling

    Yes, actually I can. This is from the United web page at the point you enter your payment info:

    Terms and conditions

    – ​​​​This ticket is nonrefundable, and a fee may apply for changes.​ View the full
    fare rules​

    – You will have up to 24 hours to change your mind. Review our 24-hour flexible booking policy.

    How much clearer could this be?

    (Tried to post a picture of the web page but no success.)

  • MarkKelling

    OK, when I went to the web site earlier the Hold description did not appear. Still doesn’t.

  • Marlon Hanson

    I like American’s policy as well. I have placed flights on hold dozens of times … I especially like having the option of 24 hours or all the way up to seven days, even though the 7 days costs me a bit. I have NO IDEA why anyone would consider it deceptive. It’s simply a great way to do it!

  • Michael__K

    It’s not really a “payment option.” It should be it’s own category, not the last radio button for payment options on the right. If your browser width is <=850 pixels, you won't see it at all (see image below).

    It might be clear to you, but we've easily seen a dozen or so passengers complaints on this site about this exact issue between the articles and the forums. So it's obviously not clear to quite a few passengers.

  • backprop

    Absolutely. If you’re going to stick your nose into making airlines standardize on a policy, at least standardize on the better one!

  • Flywisely

    Here

  • Tricia K

    If it is clear upfront that the hold is in place of being able to get a refund within 24 hours, that’s fine. But if (and please understand it has to be clear to occasional customers, not just those who know the ropes) if they are offering the hold making it seem like this is just a convenience for the customer, then I’m against it. More people than ever buy their tickets themselves and I think it’s crucial to be upfront about this. Same goes for change fees. If they are upfront about it, then it’s buyer beware. Maybe inline they can have a box you check?

  • Flywisely

    I booked one on hold for Chris. So easy.

  • Tricia K

    Would you know that’s the best option on your first trip to the site?

  • MarkKelling

    OK, I never said it was not easy — but only if you KNOW you have to choose this option.

  • JenniferFinger

    I don’t see a problem with the policy, but maybe American just doesn’t explain it clearly enough to its customers. It might need to make more clear that cancellations during the 24 hour period won’t result in refunds. Or it might need to make more clear that “hold” does not equal “confirmed reservation.”

  • MarkKelling

    I would say both options are needed.

  • Flywisely

    Especially for those who pay by debit card!

  • Tricia K

    Or, that if you buy it rather than out it on hold, you are not entitled to the 24 hour refund other airlines give.

  • MarkKelling

    No travel reservations should be done with a debit card. A credit card uses the bank’s money not yours.

  • Flywisely

    It all depends on what you want to achieve.

    If you are so sure you want the ticket then buy one with our without a 24 hour free refund. It does not matter since you are sure.
    If you are not sure you want the ticket but want to preserve the price then a free 24 hour refund means you do not have to come back and purchase it again because you already bought it. But if you want to cancel then you need to come back within 24 hours and do so.
    AA does not have this option.

    On the other hand, if you put it on hold then should you decide to buy it, then you need to come back within 24 hours and pay for it. If you don’t want to buy it, then you don’t have to do anything.

    I think the AA option is safer since you invest nothing. They don’t even have your credit card number.

  • Flywisely

    People need to understand that a refund means a sale occurred first. Therefore their credit card is charged.
    If you do not want a sale or your credit card charged then *hold* is the real option.

  • MarkKelling

    All well and good. But the question was: how would you KNOW?

    Unless you click on the HOLD button in the Payment Options NOTHING anywhere on any page on the AA web site you go through in the purchase process tells you that HOLD is even an option or what it means or what it gives you.

    I can see many customers thinking they have exactly the flight the want on the exact days they want and are completely sure they want to buy it and so click on purchase and pay for the ticket — only to then notice they misspelled their name, or they reversed the month/day in the date, or any number of issues. Which 24 hour option is then better for the customer?

  • Flywisely

    You could read American Airlines Customer Commitment page first.
    The DOT required that airlines create such a page for this exact reason – to tell the public about things like holds or refunds.

    Guaranteed fares and 24-hour hold policy

    When you make a reservation seven or more days prior to
    departure by telephone with American Airlines Reservations or via aa.com for American Airlines flights (including American Airlines flights operated by codeshare partners), the reservation can be held and the fare quoted will be guaranteed for 24 hours or until 11:59 p.m. Central Time the following day, whichever allows you more time to purchase your ticket.

    Once payment is received, normal refund policies apply to
    the ticket. If you elect to make changes to the itinerary, the ticket
    price may change.

    For additional information, in the U.S., please contact
    American Airlines or American Eagle at 800-433-7300 for further
    information. If assistance is needed in Spanish, you may dial
    800-633-3711. If you have a hearing or speech impairment, you may contact American Airlines or American Eagle at 800-543-1586.
    International reservations are handled through local offices, and those numbers can be found in local telephone directories.

  • MarkKelling

    People look at things with different viewpoints. Having different opinions does not make someone stupid. Maybe refusing to see that different opinions are acceptable does.

  • MarkKelling

    And why can’t they also put a single line blurb on the page right above the Payment Options selection that says “Check out the HOLD option.” That would eliminate most of the confusion and the complaints.

  • backprop

    I don’t think it’s a matter of being dumb. I get that there’s confusion if most airlines do it one way, and AA does it a different way.

    What I’m really taking issue with is the headline’s implication that AA is the one being “deceptive,” and that AA must be the one to bring its option down to the level of all other airlines, simply because they’ve implemented it a different way.

    The entire premise of the post is that “most companies are doing it this way, so AA should be doing it this way as well.”

    Consumer advocacy, if it’s even needed here, would encourage all airlines to choose the better option. And all things being equal – and disregarding confusion resulting from what other airlines do – IMO AA’s method is much better.

  • backprop

    I don’t think anyone would argue with helping AA (or any airline) make something more clear on a web page.

    But note that the entire premise of this blog post doesn’t suggest that AA make a tweak or two, but rather that its entire policy was borne out of a desire to be deceptive, and that it needs to drop the Hold policy in favor of a 24-hr refund policy.

    After all, Christopher, “sat across from two American Airlines VPs and told them point blank that this policy is bad for customers.”

    The policy. Not the fact that an extra blurb about it would help people (and I don’t disagree that it could).

    That’s where I take exception. This is one place where I don’t want this particular consumer advocate trying to force his beliefs on AA.

  • backprop

    I like your point about the safety of the hold option, with less financial information getting shared. That’s something I hadn’t thought of.

  • Flywisely

    I’d like an explanation where the “deception” is. That’s a pretty harsh accusation considering that the stick the DOT uses is deceptive marketing practices.

  • backprop

    We all know which headlines generate more clicks.

    The question is, what’s the end goal? Consumer advocacy? Or generating revenue under the guise of customer advocacy?

  • Kristina

    I prefer American’s hold option. And one thing that no one has mentioned so far is that the hold option existed long before the 24 hour hold was mandated.

  • MarkKelling

    And the fact that the hold policy was already available to AA customers is probably the main reason they kept that instead of moving to the refund option.

  • RichardII

    Nothing to see here folks, now move along to the next case?

  • Kairho

    Just checked and when buying a ticket one of the equally prominent buttons is to Hold. Clicking on that brings up, on that page (not linked) exactly what Hold means along with a prominent link to their hold policy. Not at all hidden.

    Having said that, the only “industry standard” here is that one of two options are mandated by the government. Nothing says all airlines must have the same procedures. That doesn’t apply to many other businesses so why should it apply here.

    And, more significantly, THIS (AA’s) policy is way more consumer friendly than what other airlines (looking at you, Delta) do. If the customer somehow forgets to take action within 24 hours they are not out the cost of the ticket, which is what happens with other airlines.

    Consumer and industry advocates should be pushing for everyone else to adopt American’s policy which is a much better “industry standard.”

  • backprop

    I think it’s interesting that 68% of the poll respondents want to pressure AA to switch, but of everyone who took the time to comment, almost 100% prefer AA’s policy, with a couple being ‘strongly neutral’.

    MarkKelling is the most vocal proponent of switching. He makes some good points..but in the end I think his dislike of AA’s policy is more the fact that it’s confusing in light of the other airlines’ policies, rather than it’s a bad policy to begin with (sorry to put words in your mouth, Mark).

    Either way, why the disparity in poll results and comments? Are robots taking the poll?

  • backprop

    I assure Christopher that I don’t literally mean that the Elliott site has armies of robots clicking buttons. I often am the first one to the poll in the morning and see the 0/0. I’m just suggesting that many people might respond robotically to whatever the headline, no matter how misleading, guides them.

  • Éamon deValera

    Yep, making more rules because people can’t read or follow simple instructions.

  • Bob

    First off, American’s hold policy predates the DOT 24 hour rule. So, actually, yes, it is something the airline wants to do.

    Secondly, I much prefer holding a fare without paying, than having to buy the fare (give the airline a loan) and then have to get a refund. Much easier. Much simpler. Much more consumer friendly.

    As for the rest of it. “Caveat emptor.” Ignorance of policy is not an excuse.

  • backprop

    So the line “It doesn’t want to do this, but it has no choice” is (gasp) a lie?

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