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DOT vs. Airlines: Should Add-on Fees Be Disclosed at Ticket Purchase?

MIAMI - JUNE 12: A United Airlines employee checks in a bag for a passenger at the Miami International Airport June 12, 2008 in Miami, Florida. United Airlines announced it will begin charging many passengers $15 to check in their first bag on top of the $25 fee for a second bag that is already in place. The airline industry is trying to off set the high cost of fuel with new fees. (Photo by Joe Raedle/Getty Images)

Should airlines be required to disclose baggage and seating fees in advance? A 2014 Department of Transport proposal is still a cause for debate.

In May 2014, the United States Department of Transportation (DOT) proposed a plan requiring airlines to disclose bag and seat assignment fees before time of ticket purchase. Since then, the DOT has received hundreds of comments from both sides of the issue. To date, they have not determined whether to keep the proposal as-is or make amendments.

If adopted, the plan requires airlines to share information for the basic services that customers tend to associate with ticket sales. These include first and second checked bags, carry-on items, and advanced seat assignments.

USA Today shared that in February 2014, 45% of U.S. Travel Association survey respondents “found it difficult to budget for travel because of fees, and that one-fourth faced a fee at the airport they didn’t anticipate.” The DOT proposal is aimed to tackle complaints like this.

Given that these fees add up to a lot of revenue (bag fees alone made up $3.5 billion in 2014), many airlines are voicing concerns. They argue that following the 1978 Airline Deregulation Act, the government does not have jurisdiction over optional service fees. However, the DOT is calling on a section of federal law that requires them “to prohibit unfair or deceptive practices in air transportation.”

Additional arguments center around the price of disclosing such fees. American Airlines estimated that in the next ten years, the effort would cost airlines $46 million in equipment, software, and labor. By contrast, predicted benefits would total only $25 million, and would come from customers purchasing the additional services, as well as reduced administrative needs for handling complaints.

“The costs at issue are quite real,” American Airlines stated in the DOT analysis, and “will inevitably be passed along to consumers in this intensely competitive industry.”

[Photo: Photo by Joe Raedle/Getty Images]

Comments are Closed.
Boggie Dog January 21, 2016

Fees are a way of trying to hide the actual cost of travel. If the fees are not disclosed up front the airline should not be able to charge the fee.

emcampbe January 19, 2016

I'd love to know how the advance seat assingment fee disclosure would go, given that at least some carriers charge different amounts for specific seats, and some use dynamic pricing (i.e. what a specific seat costs today may be different based on demand, etc. tomorrow).

Bouncer January 19, 2016

Hmm... somehow the airlines are each able to disclose *all* of these fees on their receipts both electronic and printed. Yet they need 43M to update their systems (ie: Their website) to disclose these same exact fees, only before purchase. Riiiiiiiiiight. Give us all a break. They're lobbying to continue their "bait and switch" style deceptive pricing and that's all it is about. "No! Under no circumstances be honest with the customer! We'll burst into flames if we're honest!" Seems to be the thinking around the executive suites these days. Except at Southwest. Who seems to thrive while being honest with their customers. How. Odd. Oh hey, look, it's the 43M dollar SouthWest Fees web page!: https://www.southwest.com/html/customer-service/travel-fees.html?clk=HOME-BOOKING-WIDGET-BAGGAGE-FEES Seriously, JUST TELL US! We'll either fly with your company, or another, but you won't *ever* win loyalty from a customer who feels like they were shafted at the airport. Regards, -Bouncer-

Sabai January 19, 2016

Why do the airlines consistently rail against candor in their dealings with their customers? What a perfectly awful bunch of people.

January 19, 2016

Anything that is not airfare should have its own line item. Taxes should be broken down to specific taxes and identify the collecting authority as well.