A panel from the U.S. Senate reported today that rising airline fees for seat assignments and luggage are on the rise and called for airline executives to testify on December 4. The hearing, titled “The Sky’s the Limit – New Revelations About Airline Fees” will be convened by Senator Richard Blumenthal (D-Conn). He is the chair of the Senate’s Permanent Subcommittee on Investigations and has summoned executives from American Airlines, Delta Air Lines, Frontier Airlines, Spirit Airlines, and United Airlines to testify.
I can’t help thinking that, tax avoidance aside, it’s up the the carrier how they choose to make their money - as long as it is lawful. If customers don’t like it, they can go elsewhere. The UK have had this sort of thing with EasyJet and RyanAir (maybe others, too) for years. But with them, you either pay for specific seat or get it randomly assigned for free and if you want to check in bags then it costs you, limited hand luggage is free.
It seems to me that there are three separate issues being reported here: the rising seat and baggage fees, the bounties paid to employees to catch carry-on scofflaws, and the airlines’ attempts to avoid excise taxes. The first two will always be with us, and legal. The third, not so much.
Charging more for “excess” baggage is within the scope of a company involved in “carriage for hire”, and a competitive matter. As is incentivizing employees to enforce those competitive policies, including using some form of AI to predict/identify/flag scofflaws. Sadly, the ship has sailed on the corporate use of customer data to set fees.
I see tax evasion as the only “no-no” that is worthy of a Senate investigation. The rest is theater pandering to constituencies, in which Congress has a black-belt.
We are rapidly reaching the point where it will be cheaper (and more reliable) to drop your boxed luggage off at a UPS store on the way to the airport, than to schlepp it to the airport. At that point, look for “baggage shipping” kiosks to show up at your local airport lobby.
Consider the source. The senator is just after the publicity. If the fees are made available at time of ticket purchase, so what. The market will sort it out. I personally think that the airlines should charge by pax weight. Why should a 170 pound person pay the same as a 350 pound pax?
That would be great if the airline industry was an actual capital driven market…but it is not. Today’s airline industry (mainly in the US) is for the most part an oligopoly (hint: a state of limited competition, in which a market is shared by a small number of producers or sellers).
Deregulation opened the market, created competition, but eventually, without real government oversight of mergers we now have only four major carriers and I bet their executives are real smart at “not colluding” (wink wink) on money makers like seat and baggage fees. There is no real “choice” on value any more because through marketing obfuscation, they all are doing the same thing, making passengers pay through the nose. Find me an airline today that allows me to select (save) a seat for free…naa…never mind, there is none and we wonder why there is a rise in angry passengers or incidents of “Karen’s” asking to swap seat to sit next to their kids because they tried to save money not paying for a seat and having kid X sitting three rows back.
There is no going back (sadly) unless (laughably) the US government stopped allowing mergers and let the actual market work, like letting airlines fail. Flying is a service, not a right. No need to protect bad actors.
Would be nice if the market were allowed to work. That would probably put Spirit out of business. Unfortunately the bankruptcy laws in the US will allow Spirit to survive, possibly long term. Bankruptcy laws are a primary reason we have only 4 major airlines operating. If Congress were to change the tax law so that those seat and baggage fees are taxed maybe things might change. Of course not holding my breath on that happening.
There’s no “Tax Evasion”. The airlines are complying with the rules that the government set up.
As it is, the airlines are a tax collector for the federal government anyway. Clinton increased the ticket tax to 10% where 8% goes to the airways trust fund (that finances the system and the FAA) and 2% to the general fund. The ancillary fees are not subject to the ticket tax because they aren’t part of the ticket.
But is it legal or ethical? Technically, yes. Dynamic pricing falls within the bounds of the law. Airlines, like any other business, have the right to adjust prices based on demand and market trends. However, legality doesn’t always equal fairness, and this is where the ethics get murky. Marketed as savvy business practice, dynamic pricing often feels more like a rigged game, leaving passengers confused and powerless. Many don’t realize they’re being profiled, and the hidden rules behind the system make pricing seem arbitrary and unfair.
When airlines hike fares based on your browsing history or charge families extra just to sit together, it stops feeling like healthy competition and starts edging into exploitation.
The new DOT rule on fee transparency (Final Rule Ancillary Fee Transparency, now not in effect as of November 28, 2024, due to the ongoing legal proceedings. ) did improve clarity by requiring airlines to disclose baggage and seat fees upfront. While it was a step forward, it didn’t address the core issue: an algorithm-driven system designed to extract the maximum amount from travelers while keeping the process opaque.
The real question isn’t just whether dynamic pricing is legal—it’s whether treating customers this way meets basic standards of fairness and trust. Transparency alone won’t fix a system fundamentally built to nickel-and-dime passengers at every opportunity.
Yes, but not as much less than you might expect. The pax weight is probably a significant part of the airline’s cost, but other fixed expenses would also apply, leading to a base plus cartage fee structure. These expenses could include:
Serving the seat: The cost to provide basic services (e.g., food and drink, restrooms safety demos);
Depreciation;
Lost revenue: Presumably, the airline would be making a profit on the cartage portion.
In other words, a kid would expect to pay more than one third the price of an adult.
As a lifelong Liberatarian, I’d love to see it happen.
The major carriers all allow frequent flyers to select seats without paying a fee. This is a pure free-market system that rewards regular customers who spend more money with the airlines. Someone who buys one ticket each year at Christmas isn’t going to get treated the same as someone who flies 50 times each year.