Wednesday, August 20, 2014

Top U.S. Senator opens inquiry into airline fees

The chairman of the U.S. Senate Committee on Commerce, Science and Transportation has launched an inquiry into how airlines disclose certain additional fees to consumers.

Citing concerns about transparency around a variety of airline fees, Sen. John D. (Jay) Rockefeller IV (D-W.Va.) sent a letter to 10 U.S. airlines on Aug. 18, asking that they specify the role “ancillary fees” play in their business model, and seeking specific information about the revenue generated in 11 different categories including checked baggage, fees for flight changes, priority seats and priority boarding, among others. The inquiry covers 2012, 2013, and 2014 to date.

Sen. Jay Rockefeller
“In recent years, airlines have increasingly been charging fees for ‘optional’ services, such as checked and carry-on luggage, seat selection, and priority boarding,” Rockefeller said in a statement announcing the inquiry. “These additional fees are separate from base fares for flights and have been a boon to the airlines, raising billions of dollars of revenue for them.”

The complete letter is available here.

Rockefeller’s inquiry builds on concerns raised recently by consumer advocates about whether these fees are sufficiently disclosed to consumers shopping for flights, in order to allow for more accurate price comparisons. It also drew praise from the National Consumers League (NCL).

“Consumers are fed up with the ever-growing list of add-on fees that airlines are piling on top of basic airfares,” Sally Greenberg, NCL’s executive director, said in a statement issued Aug. 20. “These fees are contributing to record airline industry profits at a time when consumers’ travel budgets remain strapped due to the sluggish economic recovery.”

Last year, NCL published a report examining what it termed “the troubling correlation between rising cancellation/change fees, the high cost of refundable tickets and the misleading marketing of travel insurance products.” Among the recommendations in the report was a call for Congressional oversight hearings to examine these issues.

The inquiry comes just over a month after the release of a study that showed five U.S. airlines took in more than $13bn in “ancillary revenue” in 2013. “Ancillary revenue” is the industry term for revenue from non-ticket sources including à la carte fees like baggage charges, the sale of frequent flier miles, commissions on travel-oriented services and other items. Read TheTravelPro post about the study here.

Because I have editorialized about the need to re-regulate the airline industry, it will come as no surprise that TheTravelPro also applauds the Senator’s action. In addition, I have written my two Senators and Representative as well as others, urging re-regulation. Those who feel similarly have my permission to use the letter that follows, either as-is or as a starting point for their own communiqués.

Dear Senator or Representative:

My recent air travels have convinced me that the only way to make our nation’s airlines more responsive to the needs of its customers is to re-regulate the airline industry.

This industry is perfectly willing to inconvenience its passengers by selling more seats than are actually available, by employing a pricing structure that is nearly impossible for the average person to sort out, by canceling flights or changing flight schedules by several hours without explanation or without notifying passengers, and by cramming more of us into ever-smaller seats. At the same time, this industry constantly invents new ways to wring every possible dollar from its customers through fees for everything from checked bags to paying extra for certain “select” seats.

While I am not asking for a return to the complete control of fares, routes, etc., exercised by the Civil Aeronautics Board, there are many things that should be more closely regulated for the benefit of the traveling public.

Airlines should be required to:

  • Offer one price for all seats in each class (coach, business, first) up to perhaps 14 days before the flight, at which time they could raise the fare because of the “last-minute” nature of the purchase. Even then, however, prices should be consistent across each class.
  • Check one piece of luggage per passenger without charge. Structuring the cost of the ticket properly should make this a simple matter.
  • Put enough people on their counters to keep check-in times to 15 minutes or less.
  • Provide seats with a pitch not less than 33”, and no less than 18.5” wide. We Americans are getting larger (our own fault, granted), but airlines are making the seats smaller. Squeezing passengers into seats 17” wide verges on cruel and unusual punishment.
  • Airlines should be prohibited from using regional jets on flights longer than 1-1/2 hours in duration. Flights longer than that aren’t “regional” anymore.
  • “Change fees” should be limited at a very low level of perhaps $25. Considering all factors, including the level of computerization and the low wages paid to airline employees, claiming it costs the airline anywhere near the fees they charge to change a ticket is simply unsupportable.
These are just for starters.

Other travelers will have their own list of things airlines “must” and “should never” do. I’m certain you could quickly compile an extensive list by asking your fellow flyers (or guests at the bar at virtually any decent business hotel) a few simple questions: What irritates you most about flying? What would you like to see the airlines required to do? And, What would you like to see the airlines prohibited from doing?

Thank you for reading this and giving the matter serious consideration.

If you agree, write your elected officials and copy Sen. Rockefeller. If not, be prepared to keep paying more and getting less for your air travel dollars.

Visit my main page at TheTravelPro.us for more news, reviews, and personal observations on the world of upmarket travel.



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