Congress says airline fees, basic math obscure deals

by Tom Johansmeyer on

Deal-hunting used to be relatively simple. You’d fire up your computer, hit a few aggregators and online travel agencies, maybe a few airline sites. Then, you’d pick your ticket and pull the trigger. The lowest number wins, right?

Wrong … at least according to Congess.

Down in Washington, the folks who’d rather not be distracted by continued high unemployment or wars in two countries dispatched investigators to dig into the wave of new fees introduced over the past few years make it hard to figure out where the best deal is. Your cheap ride seems great, of course, until you want to grab a pillow and check a bag … or not check a bag, depending on the airline.

According to USA Today:

Since 2007, many airlines have been charging for services that were traditionally included in the price of a ticket. That’s improved airline bottom lines in a tough economy but raised the ire of travelers who find themselves nickeled and dimed to substantially higher costs.

The mathematical gymnastics involved – e.g., adding a bag-checking fee to the ticket price – are more common in Europe, where easyJet and Ryanair have forced passengers to do addition for years.

While Congressional investigators don’t think passengers can do the math for themselves, it’s clear that the airlines have figured it out: 10 U.S. airlines raked in $7.8 billion in ancillary fees last year. Delta led the pack with $1.6 billion.

Spirit Airlines to Congress: paying for overhead bins helps the poor

by Tom Johansmeyer on


You just don’t need to take your bags on vacation, said Spirit Airlines CEO, Ben Baldanza. He’s told Congress that his airline, which brands itself as a “super-low-cost” carrier, actually makes it easier for the proletariat poor to take to the skies, even if it does require that they plop down $45 to stuff a carry-on into the overhead bin.

In a sense, it does. If you choose not to check a bag, that’s $5 bucks shy of half a C-note you’re tucking back in your wallet, but the cheap tickets can run a tad costly if you go with all the up-charges, according to a report by ABC News. So, the poor are all set as long as they exercise some restraint, it seems.

According to Baldanza, “We are certain that Spirit’s decision to unbundle services not essential to the transportation of passengers, has enabled more passengers to fly at lower cost.” He added, “Indeed given our low fares, it has allowed many to travel who otherwise simply could not afford to do so.”

So, what’s next for Spirit? I’m guessing that cake will be served on every flight, for a fee of course, which the airline will gladly let the poor eat.

Airline fees: Please don’t lie, don’t be moronic

by Tom Johansmeyer on

As much as you may hate ancillary fees on airlines, they’re clearly making a difference. The nickel-and-diming of the average passenger was good for a whopping $7.8 billion last year … up 42 percent from 2008. Airlines are making serious cash on inconvenient fees, which means they aren’t going away. The coming travel market recovery (look for it in 2011) will put more asses in seats and, of course, more bucks in the airline industry till. What was $7.8 billion last year only has the potential to become much, much larger.

And that could be the problem.

It might not be easy to sympathize with the airlines, companies with well-entrenched reputations for being among the most poorly run enterprises since the dawn of capitalism. But, at least when they were on the ropes (for real this time … right?), we could stomach that the ancillary fees were a survival mechanism. When revenue per available seat-mile starts to come back, passengers will become increasingly offended by the price tags popped on blankets and baggage and everything in between.Fortunately, there is a silver lining in all this: anything we feel is totally irrelevant. Airlines will charge what they can charge. Since ancillary fees are a market-wide trend, we’ll have to get used to them. Some airlines aren’t heading down this road with zeal, but they may not go to your desired destination, making the offer of goodwill moot.

And, if the extra charges were slashed, ticket prices would just increase for no apparent underlying reason, and we’d all have to share in the cost of the blanket that the gump in seat 11D feels he needs to stay warm.

The real issue, it seems, isn’t prices – they are what they are. Instead, passengers would be happier less pissed if the airlines were a bit more transparent. Notes Tim Winship of SmartTraveler.com:

The word “sneaky” appears prominently and often in consumers’ grumbling about fee-for-all pricing. And more substantively, adding injury to insult, consumers can’t make meaningful price comparisons if they don’t have ready access to all-inclusive prices from all airlines, whether it’s on the carriers’ own websites or on the site of an online travel agent.

Full fee disclosure is something the airlines should have done proactively, from the beginning. Soon, they may have no choice-as mentioned above, the DOT has included language in its proposed passenger-protection legislation that would mandate up-front disclosure of all fees associated with a particular ticket price.

The winning (or at least non-losing) formula for airline pricing seems to be simple: don’t be stupid, don’t lie and don’t charge people for the lav.

Hotels explore a la carte pricing

by Tom Johansmeyer on

We’ve spent plenty of electrons over the past two years griping about the almost comstantly arising airline fees. Paying to check bags, get blankets and so on has become part of the misery that comes with getting on a plane these days. Meanwhile, the hospitality industry managed to stay above the fray. The same pressures affecting the airlines came to bear on hotels, as well. And, the constraints on credit made it even worse, with buildings in progress struggling under the weight of insufficient or expensive capital.

Now, there are grumblings that hotels could follow the airlines. Look out for some extra fees.

That hotels would adopt an a la carte model isn’t surprising. Rather, it’s almost shocking that it’s taken this long. A recovery in the hospitality sector isn’t expected to begin until 2011, and like airlines, hotels sell a perishable commodity. For an airline, an empty seat on a particular flight can never be sold later. If 34C from New York to Las Vegas at 7 PM on July 2, 2010 is empty, it represents money that will never come in the door. Likewise, if hotel room 345 in Las Vegas is empty that night, it can never be recovered.

The money needs to come from somewhere else.Of course, hotels are no strangers to additional fees. Many charge for internet access and use of the gym, among other amenities. And, like the airlines, they cut staff and perks throughout the financial crisis and its aftermath, a situation that has not gone unnoticed. What’s on the horizon, however, could be extreme.

Could you imagine paying for use of the television? Housekeeping? Towels?

A hotel in Europe, easyHotel, is playing with this model. For low room rates, it will be hard to beat: it can get as low as $35 a night. But, the towel fees essentially mean that you’ll need to pay to shower. It will be interesting to see how this unfolds, but I’m not sure the model will be broadly applicable.

There’s more competition among hotels than there is among airlines – mainly because we have more choices available. Depending on your hometown and destination, the flights you can take are limited, even if you’re headed to a major city. Once you hit the ground, however, there are usually a number of hotels from which to choose. Often, you can pick from properties in a similar category (e.g., extended stay). With hotels eager to get guests in the door, it’s unlikely that fee-laden stays will get much traction.

Generally, I’m supportive of anything that can help a business turn a profit (that’s why they exist, after all), but I get the feeling that a la carte hotels will be niche at best. What do you think about this?

Galley Gossip: Switching seats, exit row safety & asking for upgrades

by Heather Poole on

Recently on a flight a passenger took the empty seat beside me. He had an assigned seat that he left behind. If by luck of the draw I had an empty seat (true not paid for), then it seems to me that as a beneficiary of said luck that I have inherited certain rights. If the other guy had stayed in his OWN seat, I would have had the enjoyment of more space. His moving AFFECTED me. The only reason I point this out is because while my situation was benign, I know that sometimes these little irritations or frictions on flights escalate into real on board conflicts (fights), and while I am describing out a pretty subtle point here, I think that it is better for the flight crew to mediate between passengers using preventive practices (etiquette, courtesies, “rules” etc.) rather than letting passengers resolve them themselves, in those cases where we are dealing with seat assignments at least. – Trevor

I’m going to tell you what 90% of the flight attendants I know would say. You paid for a seat. One seat. Not two seats. Not an entire row. Just a single seat. So if a passenger wants to switch seats, that’s okay. The passenger is allowed to sit in “your” row. While at my airline passengers are free to move to any open seat available in their ticketed cabin, other airlines (regional carriers dealing with weight and balance issues and airlines who charge extra for certain seats in the same cabin), require passengers to ask a flight attendant before swapping seats. If the flight attendant says it’s okay, it’s okay, the passenger can move.

Just because you were lucky enough to to score an entire row to yourself does not mean you have “inherited certain rights.” Oh sure it’s annoying when someone who already has a seat invades your space, but imagine you are the one stuck in an undesirable seat and there are two open seats in the row behind you, wouldn’t you move? Should a passenger have to suffer just because someone else is the “beneficiary of said luck” when there is plenty of room for both passengers to stretch out and relax?

In the future, if you’d rather not sit next to anyone, try making your row a little less appealing. The most popular seat on the airplane is the aisle seat. Take it! Otherwise someone will plop down beside you. Then, after takeoff, spread out. Pull the tray table down and place something on top of it. Put a bag, coat, or book in the seat beside you. Pretend to sleep. Not many people are ballsy enough to wake a sleeping passenger. Try traveling with a packet of Kleenex. No one wants to sit next to the sick guy. Or better yet, travel with a child. Works for me. Passengers avoid kids like the plague. That said, if someone still wants to sit in your row, they can. So be prepared to move your things out of the way.Airlines are charging for exit row seats and I have been on two flights where they have remained empty and flight attendants required payment from passengers who requested to switch to them. My question is what happens in case of an emergency landing? Do you think it is safer to have an able bodied person willing to open the door sitting there? I can visualize pandemonium as people rush to the door. I think gate agents or flight attendants should be able to offer these seats to qualified passengers! – Laura

While it makes sense to have willing and able bodied passengers who meet the exit row criteria seated in an exit row in case of an emergency evacuation opposed to leaving those seats vacant, FAA does not deem it necessary. I could tell you why I think this is, but it doesn’t matter what I think, or what you think for that matter. It is what it is. My question to you is, if flight attendants and agents working for an airline charging an extra fee for the exit row could move passengers to the vacant seats for free, how would they determine which lucky passengers to choose without creating the same type of pandemonium? With all that leg room, the exit row is the most sought after row on the airplane! That said, I understand why some airlines, mostly discount carriers, are charging the extra fee. They have to stay in business somehow!

At my airline we do not charge a fee for the exit row, but our ticket prices are higher than most discount carriers and the exit row is often blocked just for frequent fliers. Nine times out of ten the most elite frequent fliers occupy the exit row and bulkhead seats. So while my airline isn’t charging a fee for the row, they are asking for something even more – passenger loyalty. It comes in the form of miles. So what’s worse, an airline charging a small price to anyone willing to pay for the extra space, or an airline who only rewards a select few? Wouldn’t you rather be able to purchase the seat than not even have a shot at it?

This summer my husband and I will be traveling internationally. (New York to Warsaw) We have never asked for an upgrade to first class. If the agent says there are seats available, is there a charge? Or just willingness to fill a few seats? Additionally, what is the “polite” way to request an upgrade? – Lecia

While it never hurts to ask, it’s highly unlikely you will get an upgrade to first class free of charge. Not with airlines losing money the way they are these days. Because so many people travel often, it’s unfair to upgrade one group of passengers over another without going through the proper procedures. Trust me, passengers are keeping tabs. If an agent were to upgrade a passenger for free, rest assured that agent would hear about it in the form of a complaint letter from another passenger who also wanted an upgrade. For an airline employee, upgrading passengers for free is not worth losing a job over. Remember passengers are miserable, flights are full, and agents are under a lot of pressure to get airplanes out on time, so if you decide to give it a shot, be polite, friendly, and honest about what you want. Agents have heard it all, every story in the book, from pregnancy to bad backs. An honest approach will only work to your advantage. Whatever you do, do not hover over an agent. That will only work against you. Simply wait until the agent has a free moment to ask your question, and then, after your request has been made, step away from the desk. The last thing an agent needs is added stress.


Photos courtesy of Matt Sidesinger and Rnair