May 4, 2010— — These small fees add up. Airlines across the country charge customers extra for all sorts of services, from checking baggage to changing reservations, and it pays off for them.
Last year, U.S. airlines collected more than $7.8 billion in fees from passengers, according to the Department of Transportation’s Bureau of Transportation Statistics. And those fees are rising rapidly. In the last three months of 2009, airlines charged passengers $1.9 billion in additional fees, a whopping 18.3 percent increase over the same period last year.
And there are signs that the situation for passengers will only get worse.
Delta, followed by Continental, then United, then US Airways and finally American all raised their checked baggage fees in early 2010. And as if that wasn’t bad enough, Spirit announced last month that it would soon charge up to $45 to stow your carry-on bag in the overhead bin.
“These days, you can easily spend more on fees than on the airfare,” said George Hobica, president of airfarewatchdog.com. “The worst case scenario: an unaccompanied minor traveling with their pet cat and having to check two pieces of luggage that each weigh over 50 pounds.”
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From October to December, airlines collected $736 million in baggage fees, $564 million in change fees and $611 million in other incidental fees, such as pet transportation fees and frequent flyer mileage sales.
These figures do not take into account the countless other ways airlines make money from passengers, besides the actual cost of the ticket. These include fees for seat reservations and the sale of food, drinks, pillows, blankets and even television shows and movies on board.
The airlines consider these fees necessary for their survival. Even with all these additional services, most traditional airlines still made losses, while the so-called discount or low-cost airlines barely made a profit.
“Airlines have become addicted to fees, just as state governments have become addicted to cigarette taxes,” Hobica said. “I don’t think they’re going away anytime soon, if ever. They mean the difference between bankruptcy (that is, ceasing operations) and losing billions of dollars. Maybe the U.S. airline industry can make a small profit with fees and consolidation.”
