Why do airlines overbook flights?

The moment the doors close, an unoccupied seat is worth nothing for ever. Airlines know from years of data that a measurable share of passengers holding a valid booking never appear at the gate: flexible fares bought by business travellers, connecting passengers caught by a late inbound, people who simply change plans. If the airline sold exactly as many tickets as there are seats, those no-shows would fly as empty rows on an aircraft whose fuel, crew, handling and landing fees are already committed and cannot be recovered.

Overbooking is not a blanket policy but a forecast, run route by route and flight by flight. Revenue management systems model no-show probability against the fare mix, day of the week, time of day, season, how far ahead each ticket was bought and whether the passenger is connecting. A weekday shuttle full of fully flexible tickets may be sold well above capacity; a holiday charter with non-refundable fares and checked bags is often not overbooked at all. The systems are tuned so that involuntary denied boardings stay rare.

Sometimes everyone turns up, and then the rules matter. In the European Union, Regulation 261/2004 obliges the airline to call for volunteers first and, failing that, to pay a fixed sum to anyone denied boarding against their will: 250 euros on short flights, 400 on medium ones and 600 on long-haul, plus rerouting or a refund and care at the airport. United States oversales rules work instead as a percentage of the fare, doubling or quadrupling it according to the delay, up to a capped amount. Volunteers negotiate, which is why gate agents raise the offer until someone accepts.