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The Trump administration on Thursday said it will scrap a Biden-era proposal that would have required airlines to compensate passengers with cash, meals and lodging when carriers are responsible for canceled or severely delayed flights.
The rule, first proposed in December 2024 during President Joe Biden’s final weeks in office, aimed to bring U.S. air travel protections more in line with European Union policies, where passengers are guaranteed set compensation for cancellations and long delays.
But in a notice posted Thursday, the Department of Transportation said withdrawing the plan was “consistent with Department and administration priorities.” President Donald Trump has made scaling back federal regulations a central theme of his administration, describing the airline rule as burdensome.
Industry cheers rollback
The airline industry had strongly opposed the plan. Airlines for America, which represents major carriers including United, Delta and Southwest, welcomed the decision.
“We are encouraged by this Department of Transportation reviewing unnecessary and burdensome regulations that exceed its authority and don’t solve issues important to our customers,” the group said in a statement.
While airlines already provide limited assistance in the event of disruptions, most compensation policies are voluntary and vary by carrier. Passengers typically must request help at the airport, and airline commitments don’t carry the force of federal law.
What Biden’s rule proposed
The Biden administration’s proposed regulation called for minimum cash compensation starting at $200 for cancellations or significant delays caused by factors within the airline’s control, such as mechanical failures or computer outages. Payments could have reached $775 for delays of nine hours or more.
The proposal also envisioned free rebooking on the next available flight, including seats on competing airlines, as well as covered meals and overnight lodging.
Airlines warn of higher costs
Carriers argued the plan would backfire, raising operating costs and driving up ticket prices. In a public comment filed earlier this year, Spirit Airlines said mandatory payouts could incentivize airlines to cancel flights earlier rather than risk large penalties.
“There is no free lunch,” Spirit said. “If every time a flight has to be canceled due to, say, an aircraft maintenance issue, airlines were required to pay each affected passenger $300 plus hotel and meals, there would be a perverse incentive to cancel flights preemptively at any hint of trouble.”
Spirit, which filed for Chapter 11 bankruptcy last week for the second time in a year, has already announced plans to suspend operations in about a dozen U.S. cities.
What’s next
Without the Biden-era rule, the U.S. will continue to rely on airlines’ voluntary customer service commitments rather than enforceable federal standards. Consumer advocates argue that leaves passengers with little recourse when stranded.
The rollback underscores Trump’s broader regulatory approach: prioritizing reduced oversight of industries while casting Biden-era consumer protections as government overreach.
