Consumer advocacy organizations are bucking the Trump administration’s recent decision to scrap two Obama-era proposals concerning the disclosure of baggage fees and other ancillary fees, while airlines are praising the decision.
The Department of Transportation proposals would have required airlines to disclose fees for checked and carry on items before a ticket is purchased, and to provide more information regarding how much revenue they receive from other ancillary fees.
But consumer organizations claim that scrapping the proposals means that a consumer’s ability to comparison shop among airlines is impaired. Although airlines already are required by law to disclose optional service fees on their websites, critics argue the fees should be added to ticketing process for more transparency.
“This withdrawn rulemaking was created to allow airline consumers to determine the full cost of travel, including airfare as well as ancillary fees together with their exceptions and exemptions,” Travelers United, a membership organization that represents travelers, said in a statement following the decision last month. “Without clear, public data available to travel agents and on the Internet, travelers find it impossible to effectively comparison shop. By withholding this information from normal airline ticket sales channels, the airlines are misleading consumers about the true cost of travel."
Charles Leocha, president and co-founder of Travelers United, said the Department of Transportation’s decision was a “slap in the face to the free market.” Additionally, he said consumer groups must pursue new methods to keep greater fee transparency relevant, including getting lawmakers involved, since the proposals are no longer being considered.
Leocha said the proposals were "an examination and discussion about airline price transparency and how consumers can get the full price of an airline ticket." By withdrawing the proposals, the practices of the airlines' transparency are not even being discussed, he said.
Although the proposals had been frozen by the administration earlier in 2017, the administration announced in December that they would be dropped altogether, noting that they were “of limited public benefit.”
Consumer Reports also denounced the decision.
“We strongly disagree that these proposed rules are ‘of limited public benefit’ or would cause airlines to incur significant costs,” William McGee, aviation adviser for Consumer Reports, said in a statement. “In fact, enhanced pricing transparency benefits both consumers and competition within the airline industry.”
But airlines praised the decision and commended the Trump administration and Department of Transportation Secretary Elaine Chao for the decision.
Airlines for America, an organization that represents airlines including American, United, and Southwest, applauded the administration for “recognizing that airlines, like all other businesses, need the freedom to determine which third-parties they do business with and how best to market, display and sell their products.
“The DOT’s decision to let airlines and third-parties determine their commercial parameters is a win for consumers, and represents a much-welcomed shift from a decades-long Washington practice of micromanagement and regulatory interference,” said Sharon Pinkerton, senior vice president of legislative and regulatory policy at Airlines for America.
Airlines for America noted that they follow consumer complaints filed with the Department of Transportation and argue consumers are much more vocal about other issues they may encounter, such as flight delays.
The association also defended the transparency that already exists.
“It would be difficult to find an industry that is more transparent than the airlines, as all pricing information is readily available to travelers at the click of a button,” Pinkerton said.
“I would also note that the majority of customers do not pay for baggage, either because of their loyalty to the airline, they carry an airline credit card, or they simply do not check a bag,” she added. Pinkerton also pointed out that Southwest Airlines allows consumers to check two bags at no additional cost.
However, Leocha argued that even though airlines must have a prominent link on their homepage where consumers can find information about baggage and other ancillary fees, it isn’t transparent enough because the fees are given in ranges. This makes it difficult for consumers to pinpoint an exact cost, he says.
“The airlines only tell us how much the airfare is and then after you buy your ticket, then you find out about the trip-specific, individual-specific costs for your baggage fees, for your seat reservation fees, and for other ancillary fees,” Leocha said. “It just shouldn’t be that way.”
Leocha said Travelers United plans to reach out to Congress to work on sending a bipartisan letter to the Department of Transportation to highlight areas in which the agency is not “doing its job.” Additionally, he said the agency is no longer “examining issues to protect consumers.”
He said the agency has not implemented two pieces of legislation that were approved by Congress in 2016 requiring airlines to reimburse passengers for checked baggage fees if their delivery is delayed, and guaranteeing families with young children would be seated together.
Leocha also said that he plans to address the issue of transparency when he speaks at conferences this year.
Additionally, the Department of Transportation’s decision to withdraw the proposals has motivated groups such as Travelers United to be more vocal about the transparency of baggage fees and other ancillary fees to consumers.
“If nothing else, it’s definitely given us a shot in the arm to get our act together and really start pushing this again to the greater public,” he added.