$5.7 Billion in Airline Fees Keeping Industry Afloat
The Wall Street Journal was quick to point out that according to the Bureau of Transportation Statistic U.S. airlines earned $958 million last year, meaning their 2010 profit could be construed as entirely fee-based.
The BTS statement said that airlines collected $3.4 billion in baggage fees in 2010 and $2.3 billion in reservation change fees. Baggage fees were up nearly a quarter from $2.7 billion in 2009.
The total is certainly impressive, but the effect of baggage fees remains hard to grasp because of varying degrees of transparency. Just because some airlines charge passengers separately for their luggage doesn't mean that other airlines aren't charging fliers for their bags – they are just factoring in those costs.
Reservation change fees, which actually decreased slightly in 2010, are a more open and shut case. The fees are simply very high.
Reuters is also reporting that airlines are making a push to lobby the government into delaying deadlines requiring bag fees and fare information. Coincidence? Probably not.
The current August 23 deadline for carriers to provide e-ticketed travelers with notice of bag fees is no doubt looming large for airlines increasingly dependent on a fee structure.
An industry group is asking for the deadline to be pushed back by six months, saying they must reprogram their fee search engines to meet the new standards.
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