Good airline fees? Some are worth the money

It’s no secret the airline industry wants you to pay extra for everything.

And I really mean everything.

A fee to pay? Allegiant Air and Spirit Airlines already charge a “convenience” fee to use your credit card.

A water fee? It’s hard to find a discount carrier that doesn’t make you pay for soft drinks, including bottled water.

A fee to pee? Yeah, Ryanair’s working on pay toilets, if reports are to be believed.

But this isn’t another story about airlines and their misguided fees. It’s about the surcharges that are worth paying — and why you should consider saying “yes” to them. That’s right, I said “worth it.” While many fees are outrageous, some aren’t entirely out of line.

If nothing else, fees are unbelievably profitable. The domestic airlines collected roughly $1 billion in ticket change fees and more than $1.2 billion in baggage fees during the first half of 2009, according to the government. American Airlines took in the most baggage fees — it raked in $226 million — while Delta Air Lines won in the change-fee category, collecting a cool $392 million.

Most passengers I know don’t mind paying fees, as long as they do all of the following:

They’re optional. And it must be a real choice. Everyone uses a credit card, so a “convenience” fee to pay with plastic isn’t a true choice. Neither is a fee for the first bag, because at a time when the TSA has banned toothpaste and hair gel in reasonable sizes from all carry-ons, almost everyone checks a bag.

They don’t charge for something that used to be free. The best fees add something instead of taking away. For example, after 9/11 many airlines upgraded their in-flight menus and then began charging for food. Almost no one complained, because airlines had already done away with in-flight meals on most domestic flights. Taking a bag of pretzels that used to be free and charging for it would have been the wrong move.

They add value. JetBlue does this well. Whether it’s pillows or movies, the airline seems to know that adding to the product is the best way to do fees — not by removing amenities and services. I have a full interview with the airline in which its fee philosophy is explained. Giving passengers more for their money has made the airline profitable.

They’re reasonable. Charging a $150 change fee on a $49 ticket is completely unreasonable. A change fee should be a percentage of the ticket. Or better yet, there shouldn’t be one at all. I mean, how much does it really cost to change the date on a ticket?

So why have so many bad fees prevailed? Probably because we’ve let them, says airline analyst Michael Miller. “For example, the bag fees were done because fares were depressed and airlines were looking for other revenue sources to stay afloat,” he says. “They had no idea passengers would pay so much, so it’s permanent.”

Or so it seems.

The trend toward bad fees is reversible if passengers would only pay the surcharges they believed in. I asked travelers to help me identify those “good” fees. Here’s what they said:

In-flight wireless: This is yet another example of adding value. As long as the costs stay reasonable and the service is reliable, in-flight Wi-Fi is a winner, according to passengers like Peter DeForest, a San Rafael, Calif.-based risk management consultant. “I had Gogo on both Virgin America and AirTran, and both services were good, and worth it,” he says. With a coupon, he paid just $4.95 for six hours of connection time. “I was even able to use video instant-messaging services in flight, and it was stable and reasonably fast.”

I completely agree. I tested Gogo on a flight from Orlando to Chicago earlier this year, and it was problem-free. Definitely worth the $6 it costs to get connected.

Sections with more legroom: Janice Dottin likes the extra-legroom seats on JetBlue, because it’s affordable and you get a lot. “It’s $20 and there is a significant difference in the amount of leg space,” says Dottin, who works for an insurance company in Boston. “My husband is 6’5” tall and it’s well worth the investment for his comfort.” She’s paid for “extra legroom” seats on American Airlines, too, but was unhappy because she was just offered a seat in the exit row.

Other travelers I spoke with said they liked United Airlines’ premium economy class, because they felt less wedged into their seats. We have to be careful with this one. A customer-focused airline won’t reduce legroom in the back at the expense of those in the front — that’s a fee no-no.

Elite treatment: A fee that allows you to get preferential treatment without having to spend half of your life on a plane is a pretty good deal.

That’s what readers like Jennifer Rigdon have told me. She recently tried Southwest Airlines’ new EarlyBird program, which lets you cut to the front of the boarding line for an extra $10 per flight. (Other airlines let you use their lounges or elite check-in and screening lines for a fee, too.) “I’ll definitely do it again,” she told me. “It’s more reasonable than the upgrade to Business Select, and for $20 I think it’s worth it.” You can read the whole account here.

How about the bad ones?

Seat and reservation fees: I’ve already touched on these ugly surcharges. Permit me to beat the horse until it’s dead: Schemes that defraud passengers of $15 to sit in a more desirable economy class seat, or that force them to pay for a confirmed reservation, are utterly wrong.

Laura Wilcox, an event planner in Orlando, paid $15 for a window seat on a recent Delta Air Lines flight from Detroit to Orlando. “But when I got on the plane my seat was filled because another passenger was displaced — people go crazy to sit together as families on the Orlando flights,” she says. The airline never returned her $15.

These seat fees aren’t right because you’re paying for something twice: once for the ticket, once for the seat reservation. Aren’t they one and the same?

Convenience fees: Paying to pay is, as I’ve mentioned earlier, outright immoral. And it’s not just Allegiant and Spirit playing this fool’s game. Most of the big airlines charge extra to book by phone, another form of “convenience” fee.

Henry Harteveldt, Forrester Research’s travel analyst, believes convenience fees for credit card payments are about to spread to other airlines. That would be bad news for air travelers.

Luggage fees and other nonsense surcharges: You know a silly fee when you see one. Unfortunately, most airlines don’t.

Sharon Strelzer, a marketing manager from Fairfield, Conn., says the recent moves to start charging for the first checked bag are just impractical, given the TSA’s liquid and gel limits. She also considers seat reservation fees to be out of line, and I’ve spoken with others who would include charges for soft drinks, and especially for potable water. “The airlines should raise the rates $50 or so and be done with the nonsense fees,” she says.

Actually, not a bad idea. But carriers know that nothing sells seats like a low fare, so they’re not going for it. Until they do, these absurd surcharges will probably keep popping up everywhere.

In a perfect world, if enough airline passengers paid for the right fees and avoided the wrong ones, then market forces would compel airlines to do the right thing. But it’s not a perfect world. Some carriers have a near-monopoly in certain cities, making it difficult for markets to operate the way they’re supposed to.

Jim Goyjer, a Los Angeles-base marketing consultant and experienced air traveler, believes more drastic actions are needed. “Since deregulation of the airlines, service and quality have suffered,” he told me. On his preferred carrier, American Airlines, “almost all” of the seasoned cabin crew don’t like the company anymore. They blame top executives for mismanagement and greed, he told me. “They hate nickel and diming the passengers,” he added. “They feel more like vendors and waiters and waitresses than professionals.”

“We need to re-regulate the airlines,” he says.

Now there’s an idea.

(Photo: william couch/Flickr Creative Commons)

Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or contact him at . Got a question or comment? You can post it on the new forum.

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