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Qantas Pays $79M To Settle ‘Ghost Flights’ Case
May 6, 2024
Qantas Airways has agreed to pay $79 million (120 million Australian dollars) to settle its so-called “ghost flights” case in a move that experts are calling an attempt to end a “reputational crisis.”
CNN is reporting that the suit, which was filed in August 2023, will see 86,000 customers receive a total of 20 million Australian dollars to compensate them for booking a “ghost flight” on the airline. In industry terms, a “ghost flight” is one that is operated on a regularly scheduled route but has less than 10% of the airplane’s total capacity.
These “ghost flights” were common throughout 2022 as COVID-19 restrictions began easing up and people began flying again, the company argued. However, in this case, the Australian Competition and Consumer Commission (ACCC) said that the airline broke the law by selling thousands of tickets for flights that had already been canceled, which prompted the lawsuit.
The company had previously vowed to “fight” the lawsuit.
Consumers who bought domestic flights (that is, within Australian borders) will receive a payout of $225, while consumers who bought international flights will receive a payout of $450, in addition to a refund for the fare.
The remainder of the 100 million Australian will settle a fine that Qantas earned for the so-called “ghost flights.” Qantas has also been told not to repeat the conduct as part of the settlement.
“This penalty … will send a strong deterrence message to other companies,” ACCC Chair Gina Cass-Gottlieb said in a statement to the outlet.
The fine is the largest ever for an Australian airline, and one of the largest global airline fines in history. Nevertheless, Qantas corporate doesn’t seem too worried about the payout, as the company reported a profit of 1.47 billion Australian dollars in their year-end report.
The agreement now must go to a judge for signature and approval, though experts don’t foresee an issue with the sign-off.
“We recognize Qantas let down customers and fell short of our own standards,” Qantas CEO Vanessa Hudson said in a statement. “[The settlement] means we can compensate affected customers much sooner than if the case had continued in the Federal Court.”
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