Air Fare Game : They Get Off Early to Get Off Cheap

NEW YORK — Herbert Comrov had to go from Chicago to New York on business not long ago--so he bought a Continental Airlines ticket to Washington, D. C.

It might sound zany, but when the plane made an intermediate stop at Newark International Airport just outside New York, Comrov got off the plane and tore up the remainder of his ticket.

By doing so, he saved a lot of money.

The Chicago-Newark round-trip fare was $186 at the time, but the Chicago-Newark-Washington round-trip, even though it was a longer journey, cost only $110.

Comrov flies 100,000 to 125,000 miles a year on business and between his home in Northridge, Calif., and his office in Chicago. He is a partner in No Surrender Inc., a small Chicago company that makes and sells security equipment for department stores. His partner and the company’s chief technician are also frequently on the road.

Savings for Company

Comrov calculates that the company saves between $15,000 and $20,000 annually by taking advantage of air fare anomalies such as the one that allowed him to save $76 on his flight to Newark and back. “The savings are phenomenal,” Comrov said.

He has another reason for playing the game, though. “It is fun to put one over on these sophisticated airlines with their big computers,” he said. “It’s great to beat them at their own game.”

Stanley Phelps, director of security for the Dalton and Barnes & Noble book store chains, is on the road between 30 and 40 weeks a year. He also seeks out and uses such so-called “hidden-city” ticketing loopholes.

When he needs to go from his New York base to Detroit, for example, he buys a Northwest Airlines ticket from White Plains, N. Y., to Cleveland. When the flight stops at Detroit, he gets off and walks away, without using the rest of the ticket for the connecting flight to Cleveland.

“I save about 50 bucks,” he said.

‘Getting the Best Price’

Phelps said he encourages his subordinates to do likewise. “My job is to get the company the best price on everything, so long as I am not breaking the law to do it. In my opinion, every manager should negotiate the best price on everything.”

Comrov and Phelps are among an ever-increasing number of frequent fliers who are saving themselves or their employers millions of dollars by taking advantage of quirks that are largely an outgrowth of deregulation. When the airlines were deregulated a decade ago, they were permitted to fly any routes and to charge any fares the market would bear.

On routes to an airline’s hub city there is usually very little competition. A recent study conducted by Airline Economics, a Washington consulting firm, found there are 18 hub airports in the United States where a single airline has cornered more than half the market.

As a result, fares to or from an airline’s hub usually are its highest. Fares are much lower for passengers simply passing through the hub en route to other airports where there is more competition. With some advance-reservation fares due to rise this week, the potential savings on hidden-city fares will become even more meaningful.

Such fare manipulations are not confined to domestic carriers. Recently, for example, a traveler on British Airways’ supersonic Concorde from London to New York boasted to a fellow passenger that he had saved about $365 on his one-way ticket. He paid for a trip from London to Bermuda, got off the Concorde in New York and never used the ticket for the connecting Eastern Airlines flight to Bermuda.

The game has some interesting variations.

Regular Trips Cheaper

A Chicago lawyer (who insisted on anonymity) travels to New York about once every six weeks. He usually returns the same day or stays no more than one night.

The last time he did it, a round-trip coach ticket purchased without an advance reservation cost $565, but the round-trip fare, with an advance purchase and a required stay over Saturday night in New York, came to $118.

The lawyer buys two such round-trip tickets for $236, uses one of them for the morning trip to New York and the other one for the trip back in the afternoon--and saves $329. If he has to make two round-trips to New York in a short period of time and plans his ticket purchases carefully, he can save even more money, using the other halves of the two tickets.

“The airlines have caused these situations,” he said. “If one is bright enough to find these things, one should be able to do them. No law is being violated.”

As might be expected, the airlines are more than annoyed at such practices. They would just as soon these hidden bargains remained just that, hidden. Preferring not to give the uninitiated ideas, they are reluctant even to discuss the subject. And, they say, it is impossible to calculate the losses they incur from passengers’ exploitations of fare anomalies.

Although airline representatives concede that such fare-beating is legal, they warn that it violates published airline tariff regulations. “We would not encourage anyone to violate the rules,” a United Airlines spokesman said. “If we find anyone cheating, we will enforce the full price of the ticket.”

Uncovering such violations is difficult, however. How, for example, does an airline clerk tell the difference between a legitimate “no show” for a flight and a deliberate effort to deceive? There is no way a passenger can be restrained from getting off an airplane or forced to reboard it.

Airline representatives said most passengers are not sophisticated enough to know about such fare-cutting possibilities, and that the practice has been inspired and encouraged by travel agents trying to get their customers the lowest fares. Many agencies’ clients are companies with large travel budgets, but they, too, are trying to cut corners.

Understandably, travel agents would not speak for attribution about the practice. They said they feared that if the airlines learned they were involved in such schemes, they would lose the right to issue tickets.

Agents agreed, however, that corporate customers most often ask for ticketing with “hidden-city” fare advantages. Individual travelers seldom ask because, as one agent said: “They know about it, but not how it works.”

Offered on Request

The owner of a large travel agency in the South with major corporate clients said she never suggests “hidden-city” ticketing but does accommodate clients who request it.

“I cannot recommend a hidden city to you,” she said, “but if you call me and tell me you want to fly through Dallas or Baltimore on USAir, I don’t know if you got off. I don’t know if you saved the money. The airlines have created these situations. The airlines want us to police ticketing for them, but we are not their policemen.”

The airlines usually do not find out that a person has flown in this manner for many months after the trip has taken place. It is only when a carrier’s revenue accounting staff counts and matches up used ticket coupons that a hidden-city violation is discovered--because one portion of the ticket is missing. If a travel agent is involved, the airline will try to recover the difference in the fare and expect the agent to pass the charge on to the customer.

It is virtually impossible for a hidden-city flier to be caught at the airport if the tactic is used for one-way flights only, but alert ticket agents occasionally do catch round-trip fliers when they show up for their return flights.

If the computer screen at the ticket counter shows that a round-trip passenger walked away from the airport at an intermediate stop and did not complete a subsequent leg of a ticketed trip, the passenger’s reservation for the return flight is canceled. Then, when the passenger shows up for the flight home, the airline will not honor the ticket and will demand payment of full coach fare.

There is another drawback to using hidden-city fares: Passengers must take no more baggage than they can carry, since checked baggage will be sent to the final destination stated on the ticket.

Some airlines are taking a hard line against the practice. American Airlines sued the owner of two travel agencies for selling hidden-city tickets. The case was recently settled and both sides agreed not to disclose the terms. American did say that the agencies have been enjoined from continuing the practice.

Other airlines have written letters to travel agents warning that they will face difficulties if they do not stop selling hidden-city tickets. Yet, while some airlines at least pay lip service to enforcement, most accept the practice as a cost of doing business.

“We price our tickets out of a given city to be competitive,” a Northwest Airlines official said. “We don’t keep track of . . . (hidden-city fares). We have 15,000 competitive fares. We don’t think that it happens that often, but when it does, it is virtually impossible to stop it.”

A Continental Airlines executive said: “We have 8,000 routes and a number of fares on each route. . . . There is no question that with that large number of fares, there are going to be anomalies. These fares come and go. In such a vast network it is truly amazing that there are not more of these hidden cities. . . . We believe, overall, there are very few.”

And the Continental spokesman said he does not think the fare loopholes are a bad thing. “They are a reflection of a good thing, and that is aggressive price competition.” Largely for that reason, Delta Airlines “doesn’t actively try to catch people,” a Delta official said.

Ronald W. Miller, managing director of domestic pricing of American Airlines, said: “If we discover someone doing this, we charge them the fare they should have paid.” American calculates that less than 1% of its traffic consists of passengers using hidden-city tactics, he said, and he acknowledged that the practice does not result in a total loss because “they are paying us something for the flight.”

American has chosen not to match the competition’s prices on every route, Miller said. It does so only if it believes it can make money on the route even though it loses some money to hidden-city passengers.

Until recently, the Dallas-based carrier offered a competitive discount fare between St. Louis and Houston with a change of plane at its Dallas hub. The fare from St. Louis to Houston was lower than the fare from St. Louis to Dallas, so many people were buying tickets to Houston, then leaving the flights in Dallas.

The airline, Miller said, realized that it was losing more money than it was earning by offering the discount fare, so it cut out the discount fare on that route.

There is a source of information and support for travelers who want to use hidden-cities tickets: Tom Parsons’ monthly, Best Fares, published in Arlington, Tex. The booklet, which costs $68 a year, covers all types of airline fares, and Parsons devotes about eight pages every month to hidden-cities possibilities. He said he has 4,000 subscribers, mostly corporations.

He defended the use of hidden-city tickets: “We shouldn’t ask what this is costing the airlines. We should be asking ‘What is it saving the consumer?’ ”