1. Why are air travelers so often surprised by hidden fees for things like checked baggage, seat assignments, priority upgrades, and other optional (or ancillary) services after they've already purchased their tickets?
Over the past several years, most airlines have started to “unbundle” many services that used to be included in the basic ticket price, including things like checked baggage, priority boarding, seat assignments, carry-on bags, exit row seating, and many other options. As they did so, the airlines made a business decision to hide the fees associated with those “optional” services, often until the traveler reached the airport, or even the gate. Hiding those fees made the airlines’ basic fares appear lower and prevented consumers from comparing the cost of all-inclusive fares among airlines, one of the greatest benefits of booking travel in the electronic age. A recent study indicated that these hidden fees are now comparable to the cost of the ticket itself, adding roughly 25% to the ticket price for a typical traveler with one checked bag on many popular routes and more than 50% to the ticket price for a traveler with two bags. Travelers are justifiably mad as hell about these hidden fees, which can ruin vacations and destroy business travel planning budgets. It’s time for this broken system to be changed.
2. How can we ensure that all fees are visible to travelers and travel planners at the time that travel reservations are made?
The government needs to require airlines to make their fees fully and easily accessible to both consumers and intermediaries in the travel industry through every ticketing channel in which they participate, including the systems that power travel agencies and online travel sites. The fees should made available in electronic form, and in real time, so businesses, travel agents, and consumers can compare them for each flight – and between airlines – before they make their travel decisions.
3. Is the U.S. government taking any steps to ensure that airlines are required to share all of their fee information through every travel agency or web site that sells airline tickets?
The U.S. Department of Transportation (DOT) is currently considering new regulations to address the hidden fees problem and other airline issues. Transportation Secretary Ray LaHood has frequently expressed his concern about hidden fees, and his agency has suggested some steps to make them more transparent, so we need to fully support him and urge the agency to make sure the final regulations require full disclosure of those hidden fees. In addition to the DOT regulations, Congress is also considering legislation that may require airlines to share all their fees in advance through every distribution channel in which they participate. Although the timing of that legislation is now uncertain, we need to let both DOT and Congress know that we are mad as hell about how airlines hide their fees and urge them to fix the system by letting travelers see those fees.
4. What can individual travelers, travel agents or corporate travel managers do to register their concerns and make sure that the government takes the necessary steps in this area?
If we want a bad system to change, we need to make our voices heard, and if we all take three simple steps, we can do it.
1) Sign the petition here. If you have a story to share about your own experiences with hidden fees, you can share it there as well, so we can pass it along to the policymakers and media who are considering this issue.
2) Send an e-mail to your friends or family members telling them about the issue and asking them to sign the petition. If each of us convinces just 10 people to sign, the power of our petition is multiplied ten-fold.
3) Post a link to this page on your Facebook page or Twitter feed. We’ve only got a few weeks left to gather petition signatures, and every day counts. Help us change the system!
Finally, if you want to be really creative, you can make your own YouTube video and post it to the Mad As Hell About Fees channel. Your own voice can make your story far more powerful, and the video might even go viral!
5. The airlines say all of the fees they charge can already be found on their own sites. Why isn't that enough?
The airlines claim that burying a page somewhere on their web site that lists some, but not all, of their fees is sufficient disclosure. We say hogwash. More than 50% of travelers book their travel through brick-and-mortar and online travel agencies that have no direct access to those fees whatsoever. So for more than half of travelers, those fees are completely invisible. Even for visitors to the airline sites, the fee information is difficult to find and impossible to compare with other airlines. And when an airline decides to show a few fees during the ticketing process on their own sites, they are generally presented late in the process, after the flier has already committed to the purchase. Worse, the airlines are now rolling out “bundles” of fees that are offered to select groups of travelers, but hidden from the vast majority of their customers. In other words, the airlines claim that they are sharing the book, when in fact they’ve ripped out most of the pages, thrown some away, and hidden the rest in different places.
6. Why don't online travel sites just enter the fees by hand on their sites?
Why don’t stockbrokers just watch the ticker on TV and manually enter the prices for trades? Why don’t weather sites hire people in every city to look out the window all day, so they can manually enter the temperature? Why don’t shopping comparison sites manually enter prices from each online merchant? Because doing so would be inefficient, inaccurate, expensive, and inane. The miracle of the online medium is that it allows near-instantaneous pricing information from a wide range of sources, so intermediaries and customers can compare those prices and make the best choice. A manual approach would leave consumers vulnerable to errors from hundreds of airlines with frequently changing fees, it would make bundles of fees invisible to them, and it would prevent them from booking optional services at the time of purchase. In short, it’s an idea only the airlines would love.
7. Have any airlines made their fees public through all channels so far?
No. This will require government action. In recent Congressional testimony, Spirit Airlines CEO admitted that no airline would release all of their fees to travel agents and online travel sites unless they were all required to do so, because of the competitive disadvantage of an airline’s fee-inclusive prices appearing higher than their hidden-fee peers. Even with airline-owned and tested technology in place, none of the 26 U.S. airlines have provided real-time data to the electronic distribution systems that can distribute those fees in the blink of an eye. That’s why we need DOT and Congress to act.
8. Does the technology exist today to disseminate ancillary fees through existing sales channels, like the travel agencies?
Yes. The same organization that distributes the airlines' airfares has developed a system to disseminate airline fees. Better yet, the solution can be used for only a nominal fee. The technology is ready to go and has been tested by the airlines themselves. The major computer reservation systems that power the world's travel agents and online travel sites are ready to use this technology to allow travelers to compare the total cost of travel. With it, passengers can pay airfare and fees at the time of purchase, rather than doing it in multiple places ranging from purchase to check-in to the gate. (If a passenger wants to purchase ancillary fees at a later point, like check-in, of course they will have that option as well.) As soon as the government requires airlines to share this information, everyone will be able to search and compare the full and comparable price of their travel, regardless of whether you purchase your ticket through the airlines, reservation systems, online travel agents, corporate travel managers or the travel agency down the block.
9. Aren't you just opposed to ancillary fees as a matter of principle?
No. The airline business model has changed, and optional fees are here to stay. What every consumer deserves is simply a chance to compare prices on an apples-to-apples basis. That's what makes the free market work. We are only opposed to hidden fees that more than 50% of travelers never see until they reach the airport. It is simply not fair, and it needs to change.
10. What changes would happen in the industry if the airlines were required to make their fees visible to all consumers and intermediaries?
First, travelers could almost immediately see the full cost of travel. They could compare the total cost of their flights among airlines and could add or remove the services that interest them to see how that changes their total travel cost. In addition, corporations would immediately be able to manage travel budgets better. Most important, though, it would unleash a torrent of creativity as web designers created new applications, new web sites, and new services to help passengers understand all of the fee options. Rather than a few airlines deciding how to present (i.e. hide) their fees, hundreds of private companies and individuals would compete to offer consumers the best tools for searching, evaluating, comparing, and purchasing their flights. In the end, that would be good for everybody: consumers, travel agents, business travelers, online travel sites, and the airlines themselves.