Just how hidden are the travel industry’s so-called hidden fees?
Fair question, given that the Transportation Department just weighed in on the topic. In late April, the agency issued a final ruling affecting how airfares are advertised and displayed. The move could have a ripple effect across the entire travel industry.
Are fees completely concealed, such as the $25 “early check-in” fee Julie Sturgeon had to pay recently when she arrived at an Ocala, Fla., hotel?
“No mention of the charge on the hotel’s site,” says Sturgeon, an Indianapolis-based travel agent. “When I checked in, the receptionist just said it was hotel policy.”
Or are they only partially hidden, such as the one Karen Kinnane had to shell out when she scored an upgrade to first class on her flight from Paris to Newark last month?
“When I checked my luggage at the counter, Continental whacked me for 30 euros for a fee to leave Paris by first class,” says Kinnane, a Shartlesville, Pa., antiques dealer. “It’s a French government tax. Didn’t see that one coming.”
The answer matters. According to the latest DOT ruling, airline Web sites must “prominently disclose” information on all optional service fees starting in August. Airlines will also have to include all government taxes and fees in every advertised price.
But the government isn’t done addressing fees. It has promised a supplemental ruling later this year that could require, among other things, that fees be displayed at all points of sale.
Victoria Day, a spokeswoman for the Air Transport Association, an industry trade group, said that airlines are “committed to being fully transparent” and that carriers want their customers to know exactly what they’re buying.
Talk with airline passengers, and you’re left with a different impression. Trying to find a flight from Washington to Marseille, France, on the United Airlines site, Barbara Kreykenbohm of Falls Church, Va., was quoted a fare of $827. But on the final booking screen, the price had jumped to $942, including numerous taxes and government fees.
I asked United about the price jump. “Just like retailers and merchants across industries, we show customers a base price and a final price, which includes taxes and charges, enabling them to see clearly how much of their ticket price is paid to governmental entities,” said Charles Hobart, an airline spokesman. “At any time during the booking path, customers may click for details on the total cost of the ticket.”
Under the new rules, United will have to quote a single price that includes taxes and charges.
Jim Davidson, chief executive of the travel technology company Farelogix and one of the most outspoken opponents of the new disclosure rules, says that regulations are unnecessary. “I’m convinced that innovation, consumer demand and market forces are already in play to address matters of fee disclosure,” he told me. “The only real risk is the concept of legislating how airlines must sell their products and how consumers must buy them.”
I feel conflicted by what’s happening. As a consumer advocate, I think passengers are entitled to know the true cost of their air transportation as soon as possible. But if other industries, from auto manufacturers to restaurants, may quote a pretax price, then it doesn’t seem fair for the government to single out airlines.