The roundtrip airfare from Madison, Wis., to London is a reasonable $305 on American Airlines — until you add taxes, fees and fuel surcharges. Then it’s $691.
Delta Air Lines charges $742. Wait, make that $942 after you add in all the mandatory extras. And Lufthansa? $580. I mean, $1,034.
When Gregory Dyslin, a computer specialist who lives in Madison, found these prices through Orbitz, he was flabbergasted. “How in the name of all that is holy and right can they say this?” he wondered.
Airlines break out their fares in this increasingly absurd way because it makes their prices look lower — at least, at first — and because they’re allowed to. As long as a total fare is quoted at the end of the transaction, the government doesn’t get in the way.
Agencies like Orbitz are caught in the middle of this bizarre pricing game, in a way. But in a way, they also play along. The results of Orbitz’ search, which are displayed as a matrix, yield two fares: a less expensive base fare on top that’s boldfaced, and a “total” fare that appears below it in normal type. Why not just show the full fare?
“We want consumers to know exactly what they’re paying for,” says Orbitz spokesman Brian Hoyt.
What’s so wrong with quoting a pre-tax price? Don’t other businesses do that, and aren’t consumers used to running a few numbers before they buy? Yeah, but how much mental math should be required? It’s one thing to add a 7 percent sales tax, and quite another to more than double the price of the ticket.
Mandatory fees have ballooned in recent months, largely because of fuel surcharges. Never mind the fact that oil prices are well off their record highs. Meanwhile, base fares remain low, presumably to entice more people to fly. If they keep this up, we’ll all be buying zero dollar fares, like they did on Ryanair a few years ago. (Technically, those were zero pound fares, but you get the idea.)
Maybe that’s one reason why Europe recently enacted a tough new price transparency law, which requires airlines to quote a fare including all taxes, fees and surcharges.
If only that solved the whole problem. There’s also a third layer of fees that don’t have to be disclosed, such as charges for the first checked bag and drinks. Airlines may consider these optional, but who goes on vacation without luggage? And who spends a few hours on a plane without asking for a cup of water?
The airline industry believes these fees have no place in a price quote. Victoria Day, a spokeswoman for the Air Transport Association, described baggage and beverage fees as “separate transactions” that should not be included in the initial fare quote. I asked Day if the industry had any plans to voluntarily disclose those fees at the point of purchase, as part of the total fare. She deferred to the individual airlines, saying advertising and pricing policies were up their members.
But there are signs the Transportation Department, which regulates how fares are advertised, may see things slightly differently. Last year, for example, it forced Delta to refund baggage fees the airline had collected on tickets bought before it announced it would start charging for the first checked bag, signaling that air carriers couldn’t do as they pleased when it came to fees. Passenger rights activists think that at a time when regulation is viewed more favorably in Washington, a price transparency rule in the European model might fly.
Until that happens, here are a few tips for seeing your way around these surprise fees.
For now, the government requires that the final price of the ticket — minus “optional” items like luggage fees — be disclosed before you buy. Be sure you’re clicking the “buy” button next to the price you expected to pay. For example, when I checked Delta’s Web site for flights from Orlando to Dallas recently, I was shown a fare “From $269” in large boldface type followed by “+$42.40 taxes/fees = $311.40 in small print. Oddly, clicking on the fees took me to a page that said, “We don’t want you to have any unpleasant surprises on your bill. We’re making every effort to let you know about any taxes and fees that might be included.” Every effort? So why advertise a lower base fare so prominently, and not a total fare?
Buy from a trusted source
A few years ago, I saw a terrific airfare advertised at a mom-and-pop travel agency down the street. I walked into the store and asked an agent if any tickets were still available at that price. “Yes,” the agent said, and then whipped out a calculator. “But the fare is wrong.” She then added what appeared to be a commission to the price of the ticket and quoted a new, higher price. It was surreal. I thanked her and walked out without telling her what I did for a living. Needless to say, I now buy my tickets from a trusted source — either a travel agency I know or directly from an airline. Changing the price of a ticket after you’ve decided to book is a no-no, and any travel company that does it is ethically challenged.
Keep abreast of the rule changes
Last year may have been a doozie for new airline fees, but there’s more to come. Already, the fee geniuses at Ryanair have announced they will begin fining customers who bring too much carry-on luggage onboard. What’s next? No one knows, but it’s now up to all of us to keep up with these surcharges so that we don’t have to pay a £30 fine for bringing our laptop computer on the plane.
Question the fare after you book
You probably already know about Web sites like Yapta which track fare changes and help you secure a refund when your airfare falls. But you should also track other elements of your fare, such as fuel surcharges. Simon Gornick did after Virgin Atlantic eliminated a $400 fuel surcharge on his ticket from Los Angeles to London recently. He asked Virgin for a refund — and it refused — but the answer isn’t always likely to be “no.” If an airline is paying less for fuel, shouldn’t it pass the savings along to you?
Run your own numbers
Airline pricing systems are far from perfect. That’s what Eric Hochstein, an economic consultant from Barrington, Ill., discovered when he bought tickets from Chicago to Miami recently. Later that day, the fare dropped by $15, but a closer look at the fare breakdown revealed that the taxes appeared to account for most of the reduction. “What’s going on?” he asked. Hochstein is still waiting for an explanation from American. In the meantime, it goes without saying that you shouldn’t accept your airline’s fare breakdown as Gospel truth.
Petition the government
The folks at the online travel agency Lessno.com, who were one of the forces behind the new European fare transparency rules, have launched a petition drive that’s meant persuade Congress that the current fare display rules are ineffective. “For too long, airlines, travel agents, and airfare resellers have gone without oversight from governmental authorities that has enabled them to abuse and mislead American travelers,” they say. (You can read the petition here.) Whether you agree that airfares are screwed up, or you think I am, it never hurts to let your elected representatives in Washington know how you feel. It’s easy.
Don’t let the airlines pull a fast one the next time you fly. Buy your tickets from someone you trust, follow the fees, ask hard questions, and above all, look before you book.
The current fare displays are either misleading or totally dishonest. You deserve better. We all do.
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