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How airlines are hiding the cost of travel
Now the government wants to help them do it. Here's how to protect yourself.
When Carolyn DiDonato booked her ticket from Trenton, N.J., to Fort Myers, Fla., she says she was hit with a hidden airline fee.
On the last screen, concealed behind a drop-down menu, Frontier Airlines revealed that she would have to pay a nonrefundable $23 carrier interface charge for buying her ticket online.
"It was definitely a hidden fee," says DiDonato, a retired nurse from Hamilton, N.J.
DiDonato wishes the airline had shown the charge earlier in the booking process. If it had, then she says she would have been able to make a more informed purchasing decision.
Frontier is hardly the only airline that can be accused of obscuring the real cost of air travel, nor is the carrier interface charge its most troubling fee. Just try booking a flight in Europe, Australia or Southeast Asia and you'll encounter the same problem. Many airlines, especially discount carriers, quote a dirt-cheap base fare. But if you want to check a bag or just a carry-on bag, the cost of your fare can easily double.
If you think that's bad, just wait until Congress passes the FAA Reauthorization Bill, which funds the Federal Aviation Administration. The version being considered by Congress has a provision that would rescind a full-fare advertising rule that requires airlines to quote an airfare that includes all mandatory taxes and fees.
"Doing away with the rule may lead to opportunistic behavior by some in the airline industry," says Eric Chaffee, a business law professor at Case Western University.
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Airlines are hiding the cost of flying despite the rules
New research suggests DiDonato has plenty of company. NetVoucherCodes, a British deals website, found that many U.S. airlines conceal the true cost of flying even with the full-fare advertising rule. The company conducted its investigation by creating realistic bookings that included options such as carry-on baggage, checked bags, and seat selection.
NetVoucherCodes found Spirit Airlines hid the cost of flying the most, with the average flight cost soaring by 736%. Frontier ranked number 3, and Delta Air Lines was the worst-performing legacy airline at number 5, with an average increase of 158%. American Airlines was the most transparent on the list with an average increase of just 95%. (Notably absent was Southwest Airlines, whose fares include a checked bag and open seating.) I asked Spirit and Frontier about the study. Frontier said it does not have any hidden fees and Spirit did not respond.
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How are airlines hiding the true cost of flying?
Airlines are hiding the real cost of a ticket in many ways. But mostly, they do it by stripping away items that most passengers need, such as seat assignments and luggage. That gives the impression that their flights are much cheaper than they are.
Consider DiDonato's flight to Florida. The lowest fare from Trenton to Fort Myers in early October is just $78 roundtrip, but to get that price, you have to join Frontier's Discount Den, a "low fare" club that costs $59.99 per year, plus a $40 enrollment fee. Otherwise, the price of the flight rises by $10.
Next, Frontier takes you through a dizzying series of sales pitches, from $31 seat assignments ("If you do not select a seat now, you will be randomly assigned a seat from the remaining selection at check-in," it warns) to $58 for a carry-on bag. That's right, $58 for a carry-on bag.
Nine screens later, the airline finally reveals the full breakdown of the fare, which includes the carrier interface charge. On some flights, that fee is as high as $46. The display makes it look as if this is a government tax, but it is not.
"The carrier interface charge is a fee used to cover the technology and infrastructure costs associated with the development of web and mobile-based booking and check-in tools," explains Frontier spokeswoman Jennifer De La Cruz. You can avoid the fee by buying your ticket at the airport, she says, because you are not using Frontier’s website or mobile app. However, there is no option on the Frontier site to hold a reservation and complete it at the airport.
But that's not the worst of it. If you fly like most people — with a carry-on, a checked bag, a seat assignment and agent assistance — the price of your flight shoots up to $428. That's a 448% increase.
What's the right way to show an airfare, anyway?
Frontier should have shown DiDonato the $428 fare first, along with an option to deselect checked luggage and an assigned seat if she wanted to lower her fare.
But people aren't likely to book a $428 fare from Trenton to Fort Myers, and airlines know that. So they want to display that $78 fare and then add "optional" extras. They can sell more tickets — and they do. DiDonato booked her ticket despite the fare shenanigans because Frontier was the only airline with service from Trenton to Fort Myers.
Frontier says passengers prefer to see a low fare first. De La Cruz says its model also pressures other airlines to reduce their fares to remain competitive. And she says the way it displays prices is honest.
"The costs for optional services are disclosed in the booking process well before ticket purchase," she says.
Congress will allow even more of Frontier's brand of honesty in its upcoming FAA bill. The legislation will let airlines show you fares stripped of taxes, mandatory security fees and airport charges. That would permit Frontier to display a roundtrip fare of just $20 initially. Remarkably, Frontier charges a 7-cent airfare on the return flight to Trenton. The current full-fare advertising rule prevents the airline from being able to advertise that price.
"The Department of Transportation's Full Fare Advertising rule was hard fought and for more than a decade, it has been quite effective in forcing airlines and ticket sellers to provide the complete price of an airline ticket, inclusive of all mandatory taxes and fees," said William McGee, a senior fellow for aviation at American Economic Liberties Project.
He says the latest effort to roll back the rule is an obvious attempt by the airline lobby to make airfare shopping more confusing. As if it isn't confusing enough already.
Elliott's tips for avoiding hidden airline fees
Most airlines will try to dangle a low fare in front of you and then add extras until you're paying much more than you expected. Pallavi Sadekar, head of operations at VisitorGuard.com, says doing your homework is the key to avoiding a bad experience.
"Researching airline reviews and seeking recommendations from other travelers can also provide valuable insights,” she says.
Fly on an airline that doesn't hide its fees. In the United States, Southwest Airlines is your best bet. Internationally, Cathay Pacific, Qatar Airways and Singapore Airlines include two checked bags in the price of their fares.
Bundle your fare. Many airlines — even the most fee-happy ones — allow you to bundle fees like checked luggage and the ability to change a ticket. These can be a better deal if you do your research and compare them to an a la carte ticket.
Join a loyalty program. If you fly the same airline frequently, you'll want to sign up for its loyalty program. Many airlines let their program members avoid fees like checked luggage. But if you're not a frequent flyer, avoid these programs, as they can be habit-forming and lead to unwise purchases.
Has an airline ever hidden your airfare?
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