Analysis of hidden fees on four popular air travel routes

What is “hidden” about paying for extra legroom and checked baggage? These OPTIONAL charges are pretty well disclosed by all airlines, are they not?

I think that the analysis is skewed.

Extra Legroom: Unless you are sitting in a seat in the exit row, the only airline that I am aware of that offer extra legroom is United Airlines. I know that AA had extra legroom a few years ago but they pull it from their planes. Since US, UA and CO are my primary airlines that I fly, if there is another airline that offers extra legroom like Economy Plus on UA, please advise me.

I know that US Airways has started to allow passengers that are NOT an elite FF to purchase a choice seat (no extra legroom…not a seat in the exit row…just a seat in one of the front rows in economy) which allow them to board the plane in Group 2.

Since there can be 4 to 12 exit row seats (CRJ, 737, A319, A320) on a flight, there is a limited supply of seats with extra legroom. Also, children can’t sit in the exit row as well as adult passengers that can’t perform (i.e. broken arm, broken leg, can’t speak English, other health issues, etc.) the duties of an exit row passenger. It is very common for the elite FF to select a seat in the exit row(s) of the plane thus reducing the number of exit row seats.

Given that UA is the only airline with extra legroom (Economy Plus) and the limited amount of exit row seats on a flight, I don’t see why the cost for extra legroom was used in this analysis.

Hidden Fees: In regards to extra legroom, on the United Airlines website, the cost for Economy Plus which is an option is fully disclosed before you purchase your ticket. Also, a traveler can purchase the optional package, Premier Travel. Granted I am an elite FF but I think that the fees for checked luggage and extra legroom are fully disclosed on the airline websites that I use.

Elite Benefits: The majority of the passengers that flies are frequent flyers. If you have elite status with an airline FF program, you can check up to three bags (depending upon the airline) for free as well as sit in an exit row or E+ at no additional cost. Since I am a Star Alliance Gold member, I have been ‘upgraded’ to E+ on UA over 10 times at no cost. Also, I have been ‘upgraded’ to the exit row on CO at no additional cost.

Checked Baggage Fees: There are passengers that do not check bags. According to AA, 75% of their passengers do not pay a fee to check their luggage. At CO, if you have the CO branded affinity credit card, you can check one bag for free regardless if you are non-elite FF. Elite FFs can check bags for free.

If you are Ma & Pa Kettle that takes one flight a year, you are going to pay fees to check your luggage if you have luggage to check. However, if you are an elite FF, you are not going to pay fees.

Again, I think that the results are skewed. It is no secret that the Consumer Travel Alliance wants these fees to be included in the base fare and/or eliminated. If I was doing the analysis, I will do the following:

1. Provide a break down for each airline for each route and publish the results. For example, a passenger can’t buy a seat with extra legroom on US Airways; therefore, it should be noted.

2. Contact the airlines for the total number of passengers on these flights and how many of these passengers ended up paying a fee to check luggage.

Why have the airlines started these fees? It is simple the legacy airlines need to generate additional revenues because it isn’t a level playing field for legacy airlines (since they are the ones that charges most of these fees). The playing field is slanted to the discounters like Southwest Airlines, Jet Blue, etc.

Southwest and the other discounters have ‘cherry-picked’ their routes…choosing their routes with the most passengers to fly. They have avoided some airports with high fees and costs. JetBlue got a great financing deal from Airbus so Airbus could get market share from Boeing. If I was starting up an airline, I will do the same thing that Southwest and JetBlue have done.

One common statement that is used on why Southwest Airlines has been profitable is that they have one type of plane (737) so their maintenance costs are lower. That is true but why do they have only 737s? Why are there are no Dash-4s, Dash-8s, CRJs, etc. in their fleet and the answer is very simple, they don’t serve the small and medium airports where only the turbo-props and CRJs can land or the volume of passengers can only fill a Dash-4, Dash-8, CRJ, etc.

Recently, I flew into the Tri-City Airport (PSC) in Pasco, WA. This airport is served by Allegiant, Delta, Horizon and United plus code share flights by AA, CO and US Airways. If you want to have a level playing field, there should be legislation that will tax or penalize the other airlines such as Southwest, JetBlue, AirTran, etc. that doesn’t fly to PSC.

If the legacy airlines actually charge the real costs plus a marginal ROI for them, the fares to PSC and other small airports will be very expensive. Another option for the legacy airlines is to stop flying these ‘unprofitable’ flights to these small airports. I have been told twice by two different airline executives which I don’t know to be true or not but the revenues from the popular routes subsides the flights to these small markets.

The legacy airlines had to slash the fares on the popular routes to compete with Southwest, JetBlue, etc. on price which what the majority of the US public want, no wonder why all of the legacy airlines have filed for Chapter 11 as least one time in the past ten years.

Fares today are lower than what they were 5, 10, 15 and 20 years ago. My first flight was in 1984 on US Airways between IND and LGA. I still have the receipt for that ticket. The fare was $ 325. On June 28, 2010, I did a quick fare search on Orbitz (departing on 7/19 and returning on 7/22) for this route and the fares were: Delta: $ 185; US: $ 186; Air Tran: $ 192; CO: $ 223; UA: $ 223; AA: $ 332; Midwest: $ 333 and Frontier: $ 389.

By the way, I went to the Southwest website since Southwest does NOT allow its fares to be included in most if not all of these fare search engines, the cheapest fare was $ $445.80. Unless you ended up spending $ 260 to check your luggage and for any other fees for ONE person, it is cheaper you to fly DL and US than Southwest.

Since 1984, inflation was been 85% based upon the consumer price index (Source: http://www.inflationdata.com). The $ 325 fare that I paid in 1984 should be $ 601.25 (325 x 1.85) today. It is my guess that the these $ 185 and $ 186 flights from Delta and US Airways are at least at 80% capacity if not more. If these flights were priced at $ 600, it is my guess that these flights will be ‘empty’ and a lot of people will be driving to New York from Indiana instead of flying.

Please understand that I am no fan of the legacy airlines and their fees. I think that the corporate culture at the legacy airlines have been polluted when the airline industry was regulated and they are still polluted and poisoned 30 years later. I think that the management of these legacy airlines has made several bad decisions over the years. I think that the unions at these legacy airlines have made too many demands. I think that the business models of the legacy airlines are wrong.

However, I do think that their fees are NOT hidden as the story stated.

Charlie Leocha July 14, 2010 at 3:53 am
When you look at a display on Expedia, Travelocity, Orbitz or from a travel agent, you do not know the fees. When you decide which airline to fly, there is no way to compare these added fees.
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Expedia has conveniently displayed those FEES on their site: http://www.expedia.com/daily/flights/airline-fees.asp

Use this airline fee chart to find out who’s charging what. From baggage handling to seat selection to food and beverages—know additional airline flight costs before you book. And since policy changes are becoming more frequent, be sure to check back each time you fly.

The way that airlines add-on fees reminds me of an unpleasant experience that I had at a car dealership many years ago. I put a deposit down on a brand new car. When I went to take delivery, the dealer told me that I would have to pay an extra amount for wheel covers (hub caps) and also that there was a vehicle preparation fee added to my cost. The hub caps were of the standard type that came with every new car. They were not fancy add-on equipment. The dealer prep. fee was not disclosed on the order form. I was told that both charges were non negotiable and that my deposit would be kept by the dealer if I did not go through with the deal at the higher price.

My story ends with my going to small claims court and getting my deposit back. It’s not quite so simple with airline fees. I believe that there needs to be full disclosure of all relevant fees on online travel agent sites prior to the page where the customer actually purchases travel. Anything less constitutes a bait and switch scheme.

I think this is an issue between travel agents and airlines. It’s not so easy to stir up the flying public to make us think it’s our problem. And, the papers seem to be reporting that the airline carriers are making profits. Hard to feel sorry for them after a few flights, either.
No matter how much more expensive it may have been to fly 20 years ago, it still dosen’t seem like much of a bargain nowadays. If it’s too far to drive, you fly or you postpone the trip.

Arizona: You say “It is my opinion that you can’t have a select group of airlines that are only flying the most popular flights which is driving down the fares for these routes. This leaves the ‘unpopular’ flights to the legacy airlines where they can’t raise the rates or stop flying to these airports without get trashed by the media, these communities, etc.”

By that logic, should Target be restricted from building stores unless they’re willing to put them into any market that wants one, regardless of the size of the market? Or should they pay a penalty for each market they don’t serve? After all, by not building stores in, say, Bunkie, Louisiana, they are failing to provide enough competition to bring prices down at the local merchants. Or should they have to build one everywhere there’s a Walmart?

How about restaurant chains? Should Burger King and Wendy’s be fined or penalized for not putting a restaurant near every McDonald’s, for competition?

Sticking to travel, what about gas stations? I’ve been to any number of small towns near a highway exit where there was only one gas station, and the price was always higher than at exits where multiple stations provide competition.

None of us is entitled to a Target, a Walmart, or indeed any big discount retailer nearby. And none of us are entitled to air service. Your Pasco example – served by four airlines, with codeshare opportunities expanding that to seven physical and virtual airlines – seems to be a good example of the system working. For every such town, I can probably find four or five similarly sized towns that have no air service at all – should EVERY airline be penalized for not flying to those places?