The report released by the Senate Permanent Subcommittee on Investigations (PSI) on Nov. 26 revealed that major airlines are increasingly relying on ancillary fees, also known as “junk fees,” to generate significant revenue. This reliance on fees has led to concerns about transparency in costs and the impact on consumers.
The report, led by Sen. Richard Blumenthal (D-Conn.), examined the practices of American Airlines, Delta Airlines, Frontier Airlines, Spirit Airlines, and United Airlines. It highlighted the use of dynamic pricing, incentive programs, and other strategies to generate revenue from services that were previously included in ticket prices.
One of the key findings of the report was that Spirit and Frontier Airlines paid $26 million to gate agents and personnel between 2022 and 2023 for enforcing baggage policies. These incentives were designed to identify passengers exceeding baggage allowances, often resulting in additional fees.
The report also detailed how airlines use algorithms to adjust ancillary fees based on customer data, leading to significant variations in fees for services like seat selection, even on the same flight. Between 2018 and 2023, the five airlines generated $12.4 billion in seat fee revenue, with charges reaching as high as $899 for premium seats.
Furthermore, the report raised concerns about the lack of transparency regarding the airlines’ costs of providing these services. Airlines reported that they do not maintain detailed cost data for baggage handling or seat assignments, which raises questions about fee transparency.
The subcommittee highlighted that some airlines classify charges as “optional” services to avoid federal transportation taxes, leading to inconsistencies in how services are taxed across carriers. This can complicate price comparisons for travelers.
Executives from the five airlines are set to testify before the subcommittee on Dec. 4 to discuss consumer complaints about fee practices and potential measures to improve transparency and fairness in airline pricing.
In response to the report, industry lobbyist group Airlines for America (A4A) defended the use of ancillary fees, stating that they provide consumers with greater flexibility and affordability. They emphasized that airlines fully disclose fees at the time of purchase and comply with all laws and regulations.
Delta Airlines, in a separate statement, expressed their willingness to engage in dialogue with the Subcommittee and participate in the upcoming hearing. Spirit Airlines also defended their practices, stating that they have a history of offering affordable flights and complying with tax laws and regulations.
United Airlines declined to comment, while Delta and Frontier Airlines did not respond to requests for comment. Please rewrite the following sentence:
“The cat quickly ran across the room and jumped onto the couch.”
“The speedy cat darted across the room and leaped onto the couch.”
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