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Comments (5)
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Save/ShareYou knew the figure was going to be big. But $7.8 billion!?!
The Associated Press reports that overall, the $7.8 billion charged in "ancillary fees," which includes charges for checked baggage, seat assignments, food, pillows, reservation changes, and anything else travelers pay over and above the standard flight price, represents a whopping 42 percent increase from the previous year.
The fairly obvious takeaway is that the act of nickel-and-diming travelers is increasingly a core part of the airline business model. Some airlines use fees more than others, as shown in a Bureau of Transportation Statistics report, which forms the basis of the AP story.
Delta reaped in the most ancillary fees last year, to the tune of $1.6 billion, including $481 million from baggage fees. But for insight as to which airlines utilize fees the most in proportion to their overall revenues, check out BTS's Table 1B. There, you'll see that ancillary fees account for about 21 percent of Spirit Airlines' total operation revenues. That's 10 percentage points higher than the number two carrier on this list, AirTran. And this was well before Spirit announced it would begin charging for carry-on bags.
Delta's fees, by contrast, represent 9.1 percent of total operating revenues. And Southwest and JetBlue -- both once routinely described as "no-frills" carriers because they offered few amenities, but which both allow passengers to check at least one bag free of charge -- collect roughly 6 percent of their operating revenues from fees.
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You know, that's almost obscene. I don't mind someone making a profit in their business, but it does seem like most business's now are nickel-and-diming you to death. But what can you do. Not fly anymore.....They got ya!
Posted By Denis on May 6, 2010, 11:44 AM
The airlines should be forced by a law to incorporate all their "extra charges" into their ticket prices. This charging extra for every little thing is very annoying and should be stopped. We travelers have to research every item they charge for then add it up to see what the real ticket price is for each airline. That is totally absurd! When I buy a ticket I expect the attendants to not only be nice to me but to also include meals, beverages, snacks, free checked luggage, a free carry on, and free blankets and pillows if I am tired. I also don't expect to have to pay extra to sit with someone other than the person I am traveling with! People traveling together should automatically be sitting together. This includes economy tickets. That is how they used to operate and also how all the foreign carriers operate. Domestic airlines need to think twice about how many customers they are losing because of these charges. Just because people pay for these things doesn't mean it is the right thing for domestic airlines to do. They are ripping all of us off.
Posted By Vickie Cree on May 6, 2010, 1:20 PM
Somewhere I read that these "fees" don't end up as part of the airlines profits when it comes to paying taxes. Anyone know the facts on this?
Posted By Dovidas on May 6, 2010, 6:54 PM
Dovidas,
Many of the fees aren't taxed, actually.
Most of the airlines aren't making profits, either.
Much of the fee money goes to the airlines' bottom line.
--Sean
Posted By Blog Editor on May 6, 2010, 6:58 PM
They did not get a cent from us. After putting up with the High School drop out TSA agents, muslims in Dallas checking my id, nickle dimimg by the airlines and the airports we have stopped ALL air travel. They is no place I need to go anymore that is worth the BS.
Posted By NickP on May 6, 2010, 7:32 PM