Are outrageous airline fees going buh-bye?

By | July 7th, 2016

Airline fees aren’t disappearing anytime soon, but the most ridiculous of them may be headed for the emergency exits.

By “ridiculous” I mean United Airlines’ $50 processing fee for tickets refunded to passengers after unplanned events such as jury duty, illness or death. Or Delta Air Lines’ $25 fee for booking a ticket by phone.

“Some of these fees were irrationally punitive,” says George Hoffer, a transportation economist at the University of Richmond. “They were neither cost- nor demand-based.”

They’ve been quietly eliminated in the last few weeks, and more could follow. But don’t get your hopes too high. Airlines and fees will continue to be synonymous for a while, unless the government gets involved.

Why are the outrageous fees vanishing? Because they were, well, outrageous. Often they had no relation to the cost of delivering air transportation — in other words, they were just junk fees forced on customers — and customers despised them. The latest Qualtrics Airline Pain Index suggests four out of five travelers are annoyed by these gratuitous surcharges.

Killing the fees is also a realistic move. “It’s a modest investment they can afford to make in the context of big profits,” says Seth Kaplan, the editor of Airline Weekly. “They couldn’t do it when a few cents here and there could make the difference between surviving or not.”

John Grant, a senior analyst for OAG, describes the recent moves as a “charm offensive” by the airlines, and he expects more of it ahead. “Ultimately the possible fear of losing revenue by the traveler booking elsewhere — or, indeed, not traveling — has always been a slight concern,” he adds.

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But let’s not kid ourselves. Taken together, fees like these are what made the airline industry profitable, so don’t expect them to all disappear overnight. North America’s airlines raked in almost $11 billion in extra fees last year, up 24% from 2014. But it turns out they want to be profitable and be loved, too, and maybe you can have it both ways.

Then again, maybe not. Consider the change fee British Airways asked Samantha Sieverling, a student from Seattle, to pay when she tried to reroute her flight from Sofia, Bulgaria, back home. The reason for her change of heart? After the latest terrorist attacks, she wanted to avoid a stopover in Turkey.

To switch her itinerary, the airline demanded $275 plus a fare difference, which would have cost more than her original ticket. Of course, British Airways would have probably resold her seat, collecting twice for the same seat.

Ah, airline math.


When observers survey the fee landscape, they see the debris of junk fees like Delta’s ticket charges and United’s refund charges. And then they behold the hulking mountain of confiscatory ticket change fees such as the one Sieverling was faced with. They say airlines can clean up the junk but if they really want the good will of their customers, they’ll also have to fix the change fees.

That’s easier said than done. U.S. airlines collected nearly $3 billion in change fees in 2014, the last year for which numbers are available. That’s a tall mountain, and a lot of goodwill. But there’s a strong will to force airlines to change. Southwest Airlines, which is consistently among the most profitable airlines, doesn’t charge any change fees, so there’s a sense that this junk fee could be cleared away.

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Help might be on the way. Congress is considering a law that would force airlines to justify their change fees. Consumer advocates argue they wouldn’t be able to, and would effectively be forced to lower or eliminate them. Even if that law fails, there will be others, and advocacy groups like the National Consumers League have made it a priority to bring these loathed fees back down to earth.

Since this is America, there could be a market solution, too. A new airline called GLO launched late last year without baggage fees, no cost on food or beverage, and no seat choice fee.

“We didn’t think nickel-and-diming for something like bags was the way to go,” Trey Fayard, the airline’s founder, says. “After all, you are traveling. That means you have either been somewhere that wasn’t home or going back home – it’s pretty tough to not fly with a bag.”

GLO is a very small player, but if it’s successful, maybe the big airlines will follow. And if they don’t, maybe Congress will force them to do the right thing. They’ve already taken the first step.

How to avoid ridiculous airline fees

• Steer clear of “discount” or “low fare” airlines. Their business model is to charge an unprofitably low fare and then load up the fees. When all is said and done, you could end up paying more, with charges for everything from your seat assignment to your carry-on bag.

• Fly an inclusive airline or route. Some airlines still include the first bag on some or all flights. Others include meals and drinks. In the United States, Alaska Airlines, JetBlue and Southwest have reputations for keeping extraneous fees to a minimum.

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• Refuse to pay. That is the only way to make a fee disappear. “That’s the bottom line,” explains John McDonald, a former airline manager. “If customers don’t like them, they don’t pay. Pure and simple. If airlines can’t get people to see the value in the service — and pay the fee — it goes away quickly.”



  • sirwired

    “To switch her itinerary, the airline demanded $275 plus a fare difference, which would have cost more than her original ticket. Of course, British Airways would have probably resold her seat, collecting twice for the same seat.”

    Errr… if she was switching away from Turkey, it’s not unreasonable to guess that others were doing the same, and it seems a bit bold to assume that the airline would have been able to re-sell the seat. And yes, the fare difference for the new seat is a lot. Last minute tickets cost a lot of money; it doesn’t really matter what she did or didn’t pay for her original seat. And if the credit (minus the fee) was applied to the new seat, they aren’t “collecting twice for the same seat” at all!

    The reaction to change fees would probably be a lot less hostile if they were structured in a way that made sense. I think they should be structured like those for cruise lines: A nominal charge, if anything, waaaayyyy out from the flight, and then an escalating percentage of the fare (going all the way up to 100%) as the flight date approaches. Certainly charging $300 because you decide two days after booking that you want to leave on Saturday instead of Friday (for your vacation eight months away) and charging the same $300 because you breakup with your long-distance boyfriend the morning of the flight makes no sense whatsoever.

  • AJPeabody

    The only way to not pay any fees is not to fly. So my last two vacations were closer to home, we drove our own car (buh bye rentals), stayed at nice hotels instead of budget, didn’t scrimp on food and entertainment, and guess what, we spent less than airfare alone for for an entire vacation.

  • FQTVLR

    I am perplexed at BA connecting through Turkey. So the inquisitive side of me went into action. BA and Turkish are not partners according to their websites. So they probably do not code share flights. Does that mean she had a separate ticket from Sofia on another carrier and then would go to BA in Istanbul? Or did she book one of those convoluted OTA itineraries that make no sense but save a lot of money? Without knowing the original itinerary and the one she was attempting to change too we really cannot judge whether or not the amount BA was asking was outrageous. The change fees definitely need to go (I have paid more than my share of them complaining the entire time.) , but the fare difference is another story entirely.

  • Lindabator

    Actually – the change fees are a punitive measure to prevent willy-nilly changes as the airlines need to keep a close reign on load factors, and constant changes mean it is impossible to do so. They factor in a certain amount (business travellers are notorious for changes), but they have to keep those figures in mind at all times to ensure routing obligations, aircraft sizes, crew needs, etc.

  • Lindabator

    If you keep paying change fees, you are exactly the type of client they instituted this punitive measure FOR. The idea is to keep changes at a minimum, so they can better schedule routings, aircraft and crew needs.

  • MarkKelling

    The vast majority of flyers are sure of their travel plans long before they buy a ticket and never make any changes at all. Most are not going to just make “willy-nilly” changes to their flights even if there are zero fees to do so. Those few who do make last minute changes for the most part have valid reasons. It is just a very small number of that very small number who change flights because they just don’t feel like flying that day. That very small number can have no impact on load factors any more than the small number who simply just don’t show up for their flights.

    The argument that it would wreck the entire airline industry if the punitively high change fees were not charged is faulty. Just look at Southwest. They have no fees at all if you want to change your flight or even simply cancel it (doesn’t mean you get a refund of your fare which is a whole nother topic). They also remain one of the most profitable airlines and don’t seem to have any issues with filling planes or meeting any of the needs you listed. Their load factor is also one of the highest in the industry.

    Simple fact is, airlines charge punitive change fees just because they can and because the passengers pay those fees.

  • MarkKelling

    It is the lemming effect — one airline quits charging a fee so all the other airlines quit charging similar fees so they don’t lose a potential customer.

    Same as when they were all adding fees. Just couldn’t stand the thought of missing a dollar of potential income so every time one added a fee all the others did too.

    Glad to see the fees going away that are going. But I doubt there will be many more of them disappearing any time soon.

  • FQTVLR

    I do know that. But I have a medical condition will interfere with my travel plans. Even as a many years platinum with DL i seldom get around the change fees. I try hard and get some waived. Others I don’t.

  • Annie M

    Do you read the forums? Some of those posting on there are ridiculous with the changes they want to make.

  • Annie M

    Do you buy travel insurance? That can help when your health issues cause you to cancel a flight, as long as you buy the right policy that covers pre-ex conditions and meet the requirements.

  • Annie M

    The fee for booking over the phone is one of the most ridiculous charges. This is where inexperienced travelers make mistakes that can end up costing them hundreds of dollars because they may make a mistake vs. paying a booking fee over the phone and leads to frustration and anger at the airlines when they do err.

    They should all be happy that people want to fly their airline, regardless of whether they do it over the phone or online.

  • MarkKelling

    I don’t visit the forum often. But those asking about changes still represent only a tiny fraction of a percent of all the flyers for any one day. And I’m sure some people have some extremely ridiculous requests.

  • FQTVLR

    I do buy insurance. But on some inexpensive domestic tickets insurance is not worth the cost when I compare it to the change fee. I always buy insurance on expensive tickets and all international trips. But not on some domestic. I am an experienced traveler and have an excellent agent that handles a great deal for me including getting some fees waived. But with my chronic health problems and the fact my career requires a lot of travel changes are inevitable.

  • Michael__K

    if she was switching away from Turkey, it’s not unreasonable to guess that others were doing the same, and it seems a bit bold to assume that the airline would have been able to re-sell the seat.

    Remember, there is essentially no penalty to the airline for changing schedules 14+ days out, even under EC 261.

    So if enough passengers were doing the same, they will follow the other carriers who have suspended or cut back service to Istanbul, and will fill up the seats by using the aircraft on some other routes (and inconvenience other passengers already booked on flights that are cancelled or downgraded to smaller equipment).

  • ctporter

    Paying to select a seat in advance is a “junk” fee in my opinion, but should not be confused with paying to select a “premium/comfort/etc” seat. I have no issue with paying a premium for the more desirable seat. Selecting seats other than exit rows, bulkhead, or first few rows with extra leg room should be available without fees at the time of booking for all flyers, including families with small children.

  • PolishKnightUSA

    I think that the change fees are actually a way of shifting costs from economy fliers to business fliers because the business fliers tend to book flights at the last minute. It’s a subsidy and many people get used to paying less for a “non-refundable” ticket thinking that’s what the base price should be when it’s really artificial. If every ticket was refundable and the cost of airfare including increase in price of gasoline and taxes were spread to everyone, then tickets would be much more expensive. Then you’d see paying $50 for a checked bag on the old ticket price as “the good old days”.

    Airlines play a game much like when we buy stuff on sale or use coupons (ever watch “Extreme Couponing?”) The game with business flyers is they pay more, but they get a kickback in the form of frequent flier programs that Chris hates. They get elite status and the bigger seats for “free” but their company foots the bill. The “loyalty” perks drive the businessman to encourage him to book on the same airline, even if for a bit more, and hit his expense account while getting a bigger seat and even a free vacation out of it. Back when FF programs were created in the 80’s, a CPA told me that the IRS was cracking down on the benefits as “income”. Don’t know what happened with that.

    Sometimes, a company can be smart at avoiding this game and negotiate upfront. My friend worked at a World Bank (hint hint) and said he got to fly business class even if on an economy ticket. What a sweet deal. He had elite status and when he flew for personal reasons with the family, he rode in business class while his wife sat in economy. He says she didn’t mind.

  • PolishKnightUSA

    I don’t sympathize with the traveler wanting to reroute their flight because of the attack in Istanbul. If the flights are still going, I would personally go for this reason:

    The airport is safer AFTER an attack because the security is on high alert.

    If the flights are still running, why should the airline be penalized for making their schedule and continuing to run? Not only that, but blogs I read say that Istanbul was functioning largely as normal after the attack. Life goes on.

  • marathon man

    Oh my favorite “fee” is the fuel surcharge. How come when fuel prices went down they didnt lower or remove the fee?

    Or the one where, if you are using miles and you book a round trip ticket from say NYC to somewhere in Europe it may cost say $50-60 in taxes or fees per ticket, but if you decided to do a one way from Europe back to the states (maybe you flew to Europe on a different itinerary) then suddenly the fees and “taxes” and surcharges are like $2-300 per ticket.

  • joycexyz

    In answer to John McDonald’s exhortation to “refuse to pay”–how does that work exactly? In my world, if I refuse to pay I don’t get the flight/merchandise/whatever.

  • cscasi

    Great if your vacation spots are close enough to home to be able to drive in a reasonable amount of time. However, many people got further from home, don’t have the luxury of an extra day or two to drive the distance over and back from where they want to go and it they want to go overseas; well, they can’t drive.
    But, your point is well taken. There are ways to avoid the “fees” sometimes. That said, the “change fee” seems to be the main one most traveler’s complain about.

  • cscasi

    I have noticed that some airlines now conveniently block most of the good seats; forcing passengers to select their seats they want for a “fee”. The only other way is to select a middle seat (many would pay a fee not to be stuck in one of those) or other less desirable areas of the plane for “no fee”. As for seats with “extra legroom”, it costs the airlines more because they have to remove a couple of rows of seats to accommodate those “premium seats”, so they charge more for them (unless you have elite status that exempts you from those fees). They found it works and they have really stuck it to us while laughing all the way to the bank!.

  • MarieTD

    Thanks for pointing out that all travel can’t be done by driving.

  • bayareascott

    Southwest just charges fare differences, which to advance purchasers, can often be significantly higher than change fees. Most Southwest advocates act like they are doing customers a favor, but it isn’t true, and they leave out the full story….which is what Southwest counts on.

  • Maxwell Smart

    These fees aren’t ridiculous. Question is why is United refunding at all ?

  • Maxwell Smart

    yes in days when many fares were refundable & changes free except for fare changes, people made stupid changes all the time. Labour is expensive even in USA (moreso in Australia)

  • Annie M

    But that is the chance you take and you make a decision on what you are willing to forfeit if something should happen and you opted not to buy the insurance. At that point the traveler can’t cry “Give me a refund for xxxxxx” if they have determined what they are willing to take a chance on not buying insurance for.

  • MarkKelling

    United charges a change fee plus the fare difference. And I believe most airlines do that. (I only have recent actual experience with UA, Southwest, and Frontier on the topic.)

    So, yeah, a change fee by itself may be lower than the fare difference by itself. Just make sure what your airline actually charges in total for a change. It is well known that Southwest charges the fee differential and they also have no fees on top of that.

  • bayareascott

    That’s not exactly correct. With United, there will always be a change fee (assuming a restricted fare). There is the possibility that a fare difference may be involved, but the vast majority of the time, changes can be made for the change fee only without any fare difference necessary. Obviously, depends on specific circumstances.

  • BubbaJoe123

    “Southwest Airlines, which is consistently among the most profitable airlines, doesn’t charge any change fees, so there’s a sense that this junk fee could be cleared away.”
    The reason they don’t charge any change fees is that they don’t allow changes on anything but full-fare tickets, period.

  • jsn55

    If you can, obtain a credit card that will cover expenses of cancellation or change. Chase seems to offer some good cards with great travel perks. I love my Sapphire card; a recent medical emergency saw the Chase insurance reimbursing me in 10 days. A major reason I turned from AmEx are the great travel benefits from Chase.

  • jsn55

    Exactly what I’m wondering. I rarely have occasion to pay one of those dumb fees, but if I encountered a junk fee, how exactly would I refuse to pay it?

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