Last week, American Airlines sued a popular travel website that sells cheap air tickets by exploiting a counterintuitive airline pricing idiosyncrasy.
Because airfares are not based on distance flown, travelers are often flummoxed to find that they’ll often pay more to fly a shorter distance. There’s a risky workaround that many travelers love and airlines loathe.
In a nutshell, “skiplagging” or “hidden-city ticketing” works like this: Rather than book a flight to your desired city, it’s sometimes cheaper to book a flight with a layover through that city and simply get off the plane before the ticketed final destination, thus forfeiting the final leg of the trip.
While skiplagging is not illegal per se, airlines consider it a violation of their policies. Last month, American Airlines banned a teenage passenger for three years after he admitted to airline staff his intention to fly from Gainesville, Florida, to Charlotte, North Carolina, on a ticket for New York City. Purchased through Skiplagged.com, the ticket was cheaper, his parents told reporters, than booking a direct flight from Gainesville to Charlotte.
Boasting “ridiculous travel deals you can’t find anywhere else” and promising “flights the airlines don’t want you to see,” Skiplagged has been a thorn in the side of commercial airlines since it launched in 2013. Yet it is also wildly popular among travelers, drawing between 3.4 and 3.6 million visits in July, according to estimates from Similarweb and SEMRush. Skiplagged did not respond to Forbes’ requests for comment.
Skiplagged’s home page highlights savings both small (currently, you can save $5 flying Detroit-Orlando on September 14) and more significant ($67 saved flying from Hartford to Washington, D.C. on September 4). As a percentage, the advertised savings are frequently in the double digits.
“You can often save hundreds of dollars per ticket,” Scott Keyes, founder of the travel deal-finding site Going, told the Today Show on Monday, adding that “hidden-city ticketing works.”
Over the past decade, Skiplagged has survived lawsuits from United Airlines, in 2014, and Southwest Airlines, in 2021. The United case was dismissed and the Southwest case settled after lengthy legal battles.
American is hoping that the third time’s the charm. In a 37-page lawsuit filed last Thursday in the U.S. District Court for Northern Texas, American Airlines is accusing Skiplagged Inc. of employing “unauthorized and deceptive ticking practices,” alleging that “Skiplagged often charges consumers more than if they had booked a ticket directly with American or through an authorized agent of American.” It’s the “the classic bait and switch: draw consumers in with the promise of secret fares, and instead sell the consumer a ticket at a higher price.” The allegations continue: “Skiplagged knows any ticket it issues is at risk for invalidation, and that American could simply cancel the ticket if detected, so Skiplagged hides its activity. It also tells its customers to hide it from American.”
“The practice of hidden city ticketing is prohibited by American’s Conditions of Carriage and agency agreements,” American Airlines said in an emailed statement to Forbes. “If a customer knowingly or unknowingly purchases a ticket and doesn’t fly all of the segments in their itinerary, it can lead to operational issues with checked bags and prevent other customers from booking a seat when they may have an urgent need to travel. Intentionally creating an empty seat that could have been used by another customer or team member is an all-around bad outcome.”
In its lawsuit, the airline alleges that Skiplagged deceives its customers by implying it has the authority to issue a valid airline ticket. “It cannot. Every ‘ticket’ issued by Skiplagged is at risk of being invalidated.”
The lawsuit further claims Skiplagged provides “scripted guidance” to customers on how not to tip off the airline. Indeed, an FAQ webpage on Skiplagged appears to coach first-timers on how to beat the system. The first piece of advice is to travel light, with only a backpack. “Anything larger risks getting checked at the gate,” advises the site, warning that all checked bags will end up in the final ticketed destination. The fourth bullet point counsels, “Don’t associate a frequent flyer account — If you do, the airline might invalidate any miles you’ve accrued with them.”
Then comes another pro tip. “Some airlines may require proof of a return ticket during check-in. If this happens to you, just buy a refundable return ticket directly from the airline and cancel it ASAP after boarding.”
But perhaps it’s the last nugget that is most telling: “You might upset the airline, so don’t do this often.”