Forbidding Airlines from Imposing Ridiculous (FAIR) Fees Act would protect consumers by limiting fees for checked bags, ticket changes and cancellations
Washington (March 9, 2016) – In recent years, airlines have increasingly charged consumers fees for basic aviation services, including checking a bag and changing or canceling a flight reservation. A recent investigation by the minority staff of the U.S. Senate Commerce, Science and Transportation Committee found that of the eight carriers the Committee queried three increased checked baggage fees by 67 percent between 2009 and 2014. And four airlines increased domestic cancellation fees by 33 percent between 2009 and 2014, one increased the fee by 50 percent, and one increased its fee by 66 percent. In an effort to protect consumers from these rising fees, Senators Edward J. Markey (D-Mass.) and Richard Blumenthal (D-Conn.) today introduced the Forbidding Airlines from Imposing Ridiculous (FAIR) Fees Act, legislation that prohibits airlines from imposing fees, including cancellation, change and bag fees, that are not reasonable and proportional to the costs of the serves provided. The legislation also directs the Department of Transportation to review any other fees charged by airlines. In 2015, American Airlines, Delta, and United cumulatively earned approximately $19.4 billion in profits. Through the first three quarters of 2015, airlines collected more than $5 billion in bag fees and change/cancellation fees.
“Airlines fees are as high as the planes passengers are traveling on, and it’s time to stop their rapid ascent,” said Senator Markey, a member of the Commerce, Science and Transportation Committee. “In recent years, fees and ticket prices have gone up despite the fact that gas prices and airline choices have gone down. Airlines should not be allowed to overcharge captive passengers just because they need to change their flight or have to check a couple of bags. There is no justification for charging consumers a $200 fee to resell a $150 ticket that was cancelled well in advance. The FAIR Fees Act puts a stop to this fee gouging and will help ensure passengers are flying the fair and friendly skies.”
“This measure will ground the soaring, gouging fees that contribute to airlines’ record profits and passengers’ rising pain,” said Senator Blumenthal, a member of the Commerce, Science and Transportation Committee. “With all the frills of flying already gone, airlines are increasingly resorting to nickel and diming consumers with outrageous fees. These runaway charges are anti-consumerism at its worst – in some cases doubling passenger fares despite plummeting fuel costs and soaring airline profits. A parent who wants to sit with his young child, a customer who wants to check or carry on a bag, or have Wi-Fi, or a traveler who needs to change or cancel a reservation should not incur exorbitant, unnecessary fees on the whim of an airline.”
A copy of the FAIR Fees Act can he found HERE.
Under the FAIR Fees Act, for bag fees, airlines will only be authorized to charge fees that cover the costs of the baggage handlers, ticket agents, the baggage processing or anything that reasonably pertains to checking a bag. For example, American Airlines, Delta, and United charge more money for the second checked bag than the first, yet there appears to be no appreciable cost increase for processing the second bag. For change/cancellation fees, airlines will be authorized to charge fees that cover the cost of processing the new tickets and any potential loss of revenue due to the cancelation, noting that any loss of revenue may be minimal or even zero because the airline can resell the seat for a potentially higher fare.
The FAIR Fees Act is supported by the National Consumers League, National Association of Airline Passengers, Consumers Union, Consumer Action, U.S. Public Interest Group, Travelers United, Airlinepassengers.org, Consumer Federation of America, and Travelers’ Voice.
Add-on airline fees should be transparent and fair,” said Susan Grant, Director of Consumer Protection and Privacy at Consumer Federation of America. “Passengers shouldn’t be gouged when they need to change their plans or can’t fit their baggage into ever-shrinking overhead space.”
“Airlines are overcharging consumers with fees that are grossly disproportionate to the value of the service received and result in a windfall for airlines. “Exhibit A” is change fees, where airlines charge $200 when the true cost of a change is 6 to 7 times lower, if not zero,” said Business Travel Coalition founder Kevin Mitchell. “This kind of unconscionable consumer price gouging is a textbook example of unfair methods of competition that underpin competition laws.”