Finnair agrees to pay compensation for some of air travellers' expenses arising from volcanic ash chaos

Airline does not believe compensation will affect Q2 result

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The national carrier Finnair has agreed in principle to compensate travellers for their hotel expenses incurred during the closure of European airspace as a result of April's volcanic ash plumes from Iceland.
     
Payments will be according to the price-level in the countries concerned, and will also include compensation for meals, telephone costs, and travel expenses between the airport and the hotel where they were obliged to stay, according to the Finnish Consumer Agency.
      The Consumer Agency, the airline, and the Finnish Transport Safety Agency (TRAFI) have jointly worked out an agreement on how Finnair should recompense stranded travellers for the additional costs caused by the grounding of their aircraft.
     
The payments to consumers for hotel overnights will be based on the Hotel Price index, which indicates the average cost of hotel rooms in different cities. For example, someone stuck in Barcelona and unable to get home would be entitled under the Index to compensation of EUR 99.00 per night.
      Finnair will compensate EUR 25.00/day for additional meals and EUR 20.00 for telephone charges.
      Customers will also be entitled to claim for reasonable costs between their hotel and the airport.
     
Those passengers who took the initiative and made their own way home will receive compensation for those reasonable travel costs incurred over and above the price of their air ticket.
      The concept of "reasonable" means among other things that the return journey was made by train, bus/coach, or by ship - and not for instance in a taxi halfway across Europe.
      Compensation can be sought by filling in one's own claim on the Finnair website.
      Finnair will then request the passenger sends the original receipts of those costs for which he or she is seeking redress.
     
Passengers who are not satisfied with the compensation paid will have the right to take the matter up with the Consumer Disputes Board.
      Finnair says that each application for compensation will be handled individually.
      The airline reports that it has received around 5,000 claims, and that roughly half of these have already been handled.
      Just under 20,000 passengers have had the cost of their airline tickets refunded owing to their being unable to travel during the shutdown of European airspace.
     
The week-long hiatus in air travel was initially estimated to have cost the national carrier in excess of EUR 20 million.
      According to a Friday statement from the company "Losses arising from compensation provide no cause to change the guidance given on the second quarter result, according to which the operational loss for April-June 2010 is projected to be at the same level or smaller than the first-quarter operational loss".
      Earlier this month, Finnair reported its losses from the volcanic ash cloud had been smaller than first feared, and that the airline's business had bounced back, albeit that the growth shown was compared with historic declines in the previous year.


Previously in HS International Edition:
  Air traffic returning to normal - all bans lifted in Finland (23.4.2010)
  Finnair´s ash cloud losses smaller than first thought (10.6.2010)
  Finnair and passengers wrangle over compensation for ash delays (27.4.2010)

Links:
  Finnish Consumer Agency
  Finnair Group

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