Report released today confirms that many airlines do not consider the costs of the services provided when pricing fees

Washington (September 20, 2017) – Senators Edward J. Markey (D-Mass.) and Richard Blumenthal (D-Conn.), members of the Commerce, Science and Transportation Committee, today called on Congress to pass legislation to ground exorbitant airline fees in light of a newly-released Government Accountability Office (GAO) report confirming that many airlines do not consider the costs of the services provided when pricing their airline fees. In September 2016, the Senators requested that GAO study airline ancillary fees and their impact on consumers, including the relationship between ancillary fees and the actual cost incurred by the airline for providing the service covered by the fee.
 
“This report confirms what countless passengers across the country already know to be true – that airlines are nickel and diming captive passengers to line their pockets, not to cover the costs of the services provided,” said Senator Markey. “GAO’s findings show that many airlines are actually emboldened to increase their fees to match their competitors and actively seek to deceive passengers by offering artificially low fares and then charging exorbitant fees on the back end. It’s time to put a stop to this fee gouging and restore sanity to the skies. It’s time to pass the FAIR Fees Act.”
 
“Contrary to airlines’ claims that fares are at their lowest level in years, this report reveals that for many travelers it actually costs more to fly today than it did before the proliferation of fees,” said Senator Blumenthal. “These fees are shrouded in secrecy and clouded in confusion, making it nearly impossible for passengers to price compare and make informed choices. And these fees are rooted in the pursuit of greater profits – not in offsetting travel costs to airlines. This shell game in the skies must end. Consumers deserve real transparency and accountability, and I look forward to turning this report into passenger-friendly policies that will keep in check the airlines’ insatiable appetite for fees.”

The GAO found that:

• Few airlines consider the costs of the services provided when setting the price of their ancillary fees.
• Many airlines choose to charge fees to artificially decrease the price of airfare, making air travel appear less expensive than the true cost of flying.
• Airlines’ fees are confusing and provided to customers in a difficult-to-discern format, making it hard for customers to compare prices.
• Since 2010, airlines have introduced a variety of new fees, and increased the price of some existing fees.
• Airlines reap huge profits from ancillary fees. The eleven airlines GAO evaluated generated $7.1 billion in revenue from baggage fees and change fees alone in 2016, an increase of 13 percent from 2010.  Revenue from others fees has skyrocketed too.

 
A copy of the GAO report can be found HERE.

Senators Markey, Blumenthal and Roger Wicker (R-Miss.) introduced the Forbidding Airlines from Imposing Ridiculous (FAIR) Fees amendment, which was included in the Senate Federal Aviation Administration (FAA) reauthorization bill. The legislation passed the Commerce, Science, and Transportation Committee in June.  As modified, the Senators’ provision would ensure that change and cancellation fees are reasonable. It would also direct the FAA to establish standards for assessing whether baggage, seat selection, same day change, and other fees are reasonable and proportional to the costs of the services provided. In May, Senator Markey and Senator Blumenthal reintroduced the FAIR Fees Act.
 

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