Thursday, September 23, 2010

Hidden Fees Hoodoo

Today a trifecta of consumer groups presented U.S. Transportation Secretary Ray LaHood with a petition signed by 50,000 air travelers demanding that airlines in the U.S. more fully disclose what the groups say are 'hidden' add-on fees: extra charges for checked bags, more legroom and other features that used to be included as part of a basic airfare but now cost extra.

The three organizations - the American Society of Travel Agents, Consumer Travel Alliance and Business Travel Coalition - collected signatures on a dedicated Web site, I have misgivings about the anger and casual profanity that riddle American political discourse and wish the groups had chosen another site name, but their overriding concern about fees is well-placed.

The groups acknowledge that cash-strapped airlines need to raise revenue and don't dispute their right to add fees; they just want fees disclosed more clearly. Add-on fees can add significantly more money to the price of a ticket. Often, a corporate travel manager, travel agent or individual consumer doesn't know just how much more until reaching the airport.

Industry groups such as the Air Transport Association, whose member airlines handle more than 90 percent of passengers on U.S. carriers, counter that information about fees is on proprietary airline Web sites. The consumer groups in turn counter that by saying that information is woefully unclear and hard to find. Critics consider such opaque disclosure a form of corporate hoodoo.

So, now what?

No one knows, especially given that Congressional midterm and state elections are barely a month away. But LaHood, who in June imposed steep fines for extended tarmac delays - fines that airlines bitterly opposed - appears determined to beef-up consumer protection on a variety of fronts. For its part, the airline industry seems reconciled to dealing with expanded passenger rights but would like to have a say about what happens next.

"We share the goal of making information easily available to consumers before they purchase a ticket,'' ATA President and CEO James C. May said today in a statement. "We support the use of a hyperlink to disclose optional fees immediately and clearly.''

In theory, then, the parties agree. In practice, they are miles apart. Unless strong headwinds from the U.S. elections blow air-travel reform off-course, expect to see stricter government regulation of aviation - including, but not limited to, extra fees.

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