Airline fees: Worth it or rip-off?

by Charlie Leocha on February 8, 2013

Leocha_FoxNews
Recently, I have been on several TV news programs speaking about ancillary fees. Fox News did a segment on which airline fees are worth it and which can and should be avoided.

Naturally, I didn’t get to everything on air that we had discussed prior to the broadcast. So, here are some of my notes and observations about select airline fees.

As a point of reference, airlines have been adding fees at an amazing rate over the past four years, starting in 2008 when American Airlines was the first major airline to institute a first-checked-bag fee. Spirit Airlines introduced the absolute first US checked baggage fee about a year prior to AA.

Which fees are worth it
I think Southwest’s early bird fee is worth it. I have an older friend who travels often. The early bird fee, only $10, helps him a lot.

I spend my own money to get an extra-legroom seat on transatlantic flights. The extra legroom on Delta and United really makes a difference.

Sometimes, when I need to work, the WiFi fees are a bargain. I’m ecstatic when I need WiFi and I get on a flight that has it.

Which are just nothing more than a rip off?
For some passengers, getting on a plane early is worth an additional $40. Is it a rip-off? No, because I only have to pay it for something I want. If I had no choice, I would feel ripped off.

On the other hand, being charged a $150 change fee for changing an airline ticket or $250 for changing an international flight, PLUS the change in airfare — that’s a pure rip-off. The airlines only do that because they can. With their latest fee bundle American Airlines had all but admitted to making the change fee the throw-away designed to get passengers to pay for a checked bag and early boarding.

Charging a passenger $100 to carry on a bag is a rip-off no matter how many “warnings” are sent to passengers. Some of the third bag charges, in the range of $150 – $350-plus for international flights, are rip-offs. DOT is even looking at forcing airlines to alert passengers that they are going to be dinged with a BIG fee.

Can you get any of these extras for free?
There are lots of way to get around the fees, but you have to give up some freedom and dance to the music that airlines play.

Get a special airline credit card and many airlines will allow you to board early for free and check your first bag for free.

If you are a member of a frequent flier club and amass enough miles to become an elite flyer, you can avoid many of the fees — from checked bags, to telephone help, to extra legroom and early boarding,

Otherwise, the system is pretty locked down. It is pay-to-play when it comes to extras on airlines. Even flight attendants don’t have the flexibility they once had.

Fees are complicated and getting more complicated
Fees are reaching a dizzying level of complication — fees for printing out boarding passes, fees for getting on the plane early, fees for holding a reservation and so on. However, every static fee is somewhat understandable. They are undesirable and irritating, but with some digging we can discover what the fee will be despite how much we hate the fee.

But now the airlines are moving into areas where these maddening fees are becoming more complicated and almost impossible to compare. They are starting to change the fees based on mileage, time of the year and other factors. It is already the norm with many airlines for seat reservations, and soon some airlines are boasting that they will vary baggage fees based on distance, destination and the time of the year when passengers fly.

Spirit has suggested that during the Christmas season, when passengers are carrying gifts, they might start charging more for checked baggage. Wouldn’t that be nice.

And now come the bundles
American and Delta are already bundling fees, making it hard to know what exactly you are paying for each fee and forcing passengers to figure out whether it really is a deal or not.

With American Airlines’ latest bundled fees, passengers can pay an additional $68 per round-trip for a checked bag, early boarding and the ability to change flights without incurring the $150 change fee. When you add it up, passengers are being asked to pay a new fee to avoid paying a less-desirable fee. It really is amazing.

Airlines are still effectively hiding their fees from all travelers.
Airlines don’t tell passengers how much seat reservations fees are until they have filled out forms on their website and are several pages into the reservation. If travelers are buying a ticket from a travel agent, even an online travel agent, passengers are never told of specific baggage fees and seat reservations fees. They have to purchase their tickets and then look on the airline sites for the fees they may have to pay.

The only real way to compare dynamic fees with all of the exceptions granted for frequent fliers and credit card users is for travelers to go to each major airline flying the route they are researching, go through the reservation process and then manually compare prices. It is unfair to consumers who cannot easily compare apples to apples when making airline reservations.

The Consumer Travel Alliance is battling this war of deception and the misleading acts of withholding fees from passengers so that they can compare prices across airlines. The Department of Transportation is working on a new regulation that will require airlines to be upfront about specific fees they will be charging so that, hopefully, in a few years, consumers are not flying blind.

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  • Stephen0118

    Although Southwest has increased the Early Bird fee (I forgot by how much) I will still purchase it, just so I can get an A group boarding pass so I can get a window seat.

  • madtad1

    Here is a suggestion for a way to limit the fees in one easy step, but, some background first. The reason the airlines charge fees is simple, but hidden: they don’t have to pay/charge taxes on those fees, like they would if they were included in the price of our tickets. Thus, the fees are pure profit for them.
    Now the suggestion: the governement taxes the airlines on the fees as well as everything else. Since the airlines claim the fees are part of the price of doing business, then tax those fees as well.

  • ChBot

    Taxes and … 3rd parties commissions and rebates !!!… Taxes are usually only the tip of the iceberg !!!

  • bodega3

    If travelers are buying a ticket from a travel agent, even an online travel agent, passengers are never told of specific baggage fees and seat reservations fees. They have to purchase their tickets and then look on the airline sites for the fees they may have to pay

    ****************************************************************
    What TA’s aren’t telling clients of this? Brick and Mortar agents? OTA? Not my clients. They know everything BEFORE they buy! Are you telling more lies Charlie? Same old crap from you at least once a week to try and scare people.

    As for the change fees. I don’t like them either, but I get why the carriers charge them. People can make committments and higher fees get people not to cancel. I do know that at one time the cost to make the change was only about $25…as that is what they use to tell us our time was worth when they actually paid us part of that fee.

    **********************************************************************
    I spend my own money to get an extra-legroom seat on transatlantic flights.

    Oh, no! Maybe you should get a real job that actually values you and pays for your comfort in Biz class!

  • MeanMeosh

    It’s going up to $12.50. And I learned the hard way that EarlyBird does NOT guarantee an A boarding pass! I was stuck with B-5 on my flight from DAL to STL yesterday. First time that’s happened, but hopefully not a sign of things to come.

  • MeanMeosh

    It would be nice if you would stop shilling for the GDSs – the REAL culprit where inadequate fee disclosure to travel agents is concerned – but at least you recognize that not all fees are a rip-off. EarlyBird is a bargain (though I’ll quit paying it if I keep getting B boarding passes like I did yesterday), and I actually like AA’s new “Choice Essentials” bundle. Before, if my plans were uncertain, I’d book Southwest to avoid the change fee. I’d just as soon book AA, if the price were competitive even with the extra $68.

    The biggest rip-off if you ask me is the $99 one way fee BA charges to select a seat more than 24 hours in advance in BUSINESS class – nickel and diming your best customers is really idiotic if you ask me. And I’m sure now that the inevitable US/AA merger is going to happen, you’ll see US bring back the hated $2 soda fee, since they’ll now have that much more pricing power.

  • bodega3

    The information is in my GDS. Do you use one? We know Charlie doesn’t and doesn’t know how to get what he needs.

  • http://www.nycparamount.com/events NYCEvents

    I wish there was some sort of a rate card where the prices for all the kind of services offered would be put in black & white so that nobody would feel cheated.

  • DCTA

    I don’t have a problem getting the info from the GDS.

  • DCTA

    I really don’t understand this, I inform my clients of all fees and I’m a TA. What are you talking about Charlie? I can’t even get a ticket issued out of my system without going through QC and QC won’t allow me to ticket unless I’ve included notes with all the pertinent fees. Surely you must know that Agencies are doing this?

  • DCTA

    Just to clarify – all the notes about pertinent fees appears in BOLD CAPS at the top of the itinerary.

  • http://www.tripso.com/author/leocha Charlie Leocha

    @DCTA As I understand it:
    – When travel agents pull up a schedule they have no way to easily compare on one screen prices across airlines for your clients including fees unless they pull up information airline-by-airline. No online travel agency provides this ability. No GDS that I know of does either.
    – After travel agents compare airfares, then return to book the least expensive or desired flights, airfares may have changed. Certainly, passengers using online travel sites face this problem.
    – Travel agent software cannot predict airfares and extra fees based on elite level of passenger or based on the credit cards utilized to purchase airfare.
    – If airlines disclosed these fees in a format useable by travel agencies, software can be developed to allow effective price comparison across airlines including frequent flier status and method of payment benefits.
    – Can travel agents and consumers see the fees? Yes, airline-by-airline, with difficulty, especially for users of online travel tools. No airline allows passengers to determine the price of a seat reservation until after they navigate through several screens and fill out TSA information. No major airline allows passengers to pay for baggage fees at the time of booking.
    – No airline allows universal transactions of ancillary fees. Consumers and travel agents are forced to go from one screen for airfares to another in order to purchase extra fees.
    – For corporate travel agents this bifurcation of the purchase process and nondisclosure of dynamic fees makes it difficult to budget for overall travel costs and creates problems when corporate travelers request reimbursement for various fees.

    I have been working together with representatives of GDSs and travel agents to get airlines to release their extra fee data in a real-time, dynamic basis so that consumers (both corporate and leisure) can easily compare the full cost of travel across airlines anywhere that airlines choose to sell their airline tickets.

  • bodega3

    If Charlie really cared, he would check this out and write a truthful article. Complaining isn’t good journalism. A good journalist does research and gets the facts instead of writing lies.

  • http://www.tripso.com/author/leocha Charlie Leocha

    Dearest Bodega 3,
    I’ll make the generous assumption that you got out of bed on the wrong side today and that you did not really want to accuse me of telling lies. That is a serious charge.
    If I am lying, I am in good company — all of the GDSs, ASTA, 300+ travel management companies, even the airlines who agree what I say is true. I have sat through hours of congressional and DOT testimony, met with executives at the highest levels of the transportation industry, with the Secretary of Transportation, with the CEO of Airlines for American and with airline CEOs.
    Please send me an article with the truth and have it vetted with each of the organizations I have mentioned above and I will be happy to publish it. Better yet, rather than snipe from the sidelines on blogs, make an appointment in DC with DOT and through the White House with OMB and tell them that they can fold their tents on the transparency issue; that all of their work over the past three years has been mistaken.
    Speak with the major newspapers and send them Op-Ed articles explaining how the rest of the airline world is lying and you are the only one telling the truth.
    Perhaps, you may be mistaken. Or, we are discussing totally different subjects.

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