Salvaging Your Trip When the Flight Is Cancelled

American Airlines alone has cancelled more than 2,400 flights since Tuesday, grounding some 250,000 passengers. In the past several weeks, Delta has cancelled 275 flights; United, 31. Midwest Airlines cancelled 10 flights, while Alaska Airlines terminated 14. All of the cancellations are due to emergency aircraft inspections and repairs. In early March, the Federal Aviation Administration fined Southwest Airlines $10.2 million for continuing to fly jets that missed a required inspection. Now carriers are scrambling to avoid similar penalties.

"They're overreacting, but can you blame them?" asks George Hobica, publisher of fare-tracking site Airfare Watchdog. Getting slapped with millions of dollars in fines would only exacerbate the airlines' current financial issues. "The airline industry is the canary in the coalmine. It's so fragile against economic woes."

So fragile, in fact, that a handful of smaller airlines have had to ground their flights permanently. Since March 31, Aloha Airlines, ATA and Skybus have all ceased operations. A fourth, Champion Air, announced it will stop flying at the end of May. More may follow, warns Pauline Frommer of Frommer's Travel Guides. "Alitalia has made no secret of the fact that it only has enough money to get it through June," she says. Other industry rumblings put Frontier and Sun Country in the danger zone as well.

This perfect storm of events has and will continue to leave tens of thousands of air passengers grounded. Not only that, but these stranded passengers will now be jockeying for space on overcrowded flights, spelling trouble for all travelers.

Here's what you need to know if your airline is shuttered, your flight is cancelled or your plane overbooked:

When the cancellation is the fault of the airline — as in the recent spurt of repairs — most airlines will be more generous. American Airlines, for example, has been bending over backward to soothe angry consumers, says Parsons. "If they could find hotel rooms anywhere, they've been comping them," he says. Passengers have also been receiving meal vouchers, and up to $500 in vouchers for future travel. That's in addition to the first available seat American can find to your destination, even if it's via another airline.

Although the infamous Rule 240 — a federal requirement that stipulated airlines must put you on the first available seat, regardless of class or carrier — is now long dead, many carriers still offer similar protections in their contracts of carriage, which outline passenger rights. The problem is that the backlog of passengers from all of these cancelled flights has made it next to impossible for the airlines to accommodate everyone. With other carriers already flying crowded flights, there's little wiggle room to shuffle people from one airline to another, and few standby seats. Your options are to wait at the airport for an open seat, or pay for another ticket on a competing carrier. (Remember, you'll eventually receive a refund from that cancelled flight.)

The best way to deal with an un-refunded fare is to take the matter to your credit-card company. The Fair Credit Billing Act permits consumers to dispute charges for services paid for but not received, which includes travel arrangements. (For more on the ins and outs of filing a credit-card dispute, see our column "Extreme Customer Service Solutions.") Paid by another method? Sorry, you're out of luck. "Travelers who paid by cash or check have to go file claims in bankruptcy court, and probably won't see a cent," says Frommer.