Let’s get one thing straight: the latest round of fuel surcharges on cruises and airline tickets have about as much to do with higher fuel prices as hotel “energy” surcharges in 2001 had with higher electricity costs — which is to say, not much at all. No, these are opportunistic fees tacked on to your bill because there’s a perception that your cruise line or airline has to pay more to keep the planes and boats running. And because the fees are bogus, they can be fought.
Air carriers are already paying for their high fuel costs through a series of unprecedented fare hikes. So when United Airlines announced that it is adding a $5 each way surcharge to domestic ticket prices to “offset the price of jet fuel,” it was telling a half-truth, at best. United has already raised prices; it’s just helping itself to more of your money to ensure continued profitability.
“It’s a game,” says travel agent Janice Hough, who points out that a United ticket from Washington to London costs $195 roundtrip, until taxes and fuel surcharges are factored in. Then, the price goes up to $504. “So taxes and surcharges are over 150 percent of the fare,” she says.
It’s a game travelers don’t like to play. Consider the case of Jeff Johnson or Fennville, Mich.
I recently booked a seven day cruise with Princess Cruise Lines on the Crown Princess. I have fully paid for my cruise and am just waiting to sail in February. Today I received an updated booking notice that says effective Feb 1, 2008 there will be a $35 per person fuel surcharge.
I am aware of the increase in fuel costs, but isn’t this a charge that should be added at the original time of booking? I have contacted the Princess Line and was told “its what all the cruise lines are doing.”
The fee seems excessive on a ship that carries over 3,000 people. Are we paying for a fuel increase of $100,000?
No one likes hidden charges and Princess should adjust their future booking prices so there aren’t surcharges after the customer has paid. Do I have any recourse in regard to these fees?
As a matter of fact, we do.
Retroactive fuel surcharges can be appealed. The key to overturning a retroactive fuel surcharge is a careful reading of the cruise contract, the legal agreement between you and the cruise line. For example, Princess’ contract has this to say about its fares: “The Cruise Fare does not include beer, wine, spirits, sodas or other bottled beverages, or charges for other incidental items, activities, excursions or personal services during the Cruise, or any Government Fees and Taxes for which a separate charge may be imposed.” But there’s no mention of a fuel surcharge, and indeed, it’s clear that once you pay the fare, there will be no future increases. Bottom line: Princess is out of line.
Future fuel surcharge can be protested. It’s imperative to keep the pressure on airlines and cruise lines to do the right thing — if their costs go up, they need to raise prices, not add a “surcharge.” These fees may, in fact, be illegal. A letter sent to the Department of Transportation or the Maritime Commission, questioning the legitimacy of the fees, could pressure these travel companies to drop these silly extras. Here’s a complete list of contacts.
Be on the lookout — read your ticket carefully. This is the time when travel companies will try to sneak a surcharge on to your bill without sufficient disclosure. Review your ticket and don’t hesitate to question a suspicious surcharge. Be particularly vigilant when it comes to your hotel bill. I think resorts may see higher energy costs as an opportunity to pull a fast one.
Make no mistake, these fuel surcharges are wrong. Hough puts it like this:
Can you imagine if you went to buy your wife a cashmere sweater and they told you it was $50, but that there was a $50 ’sewing’ fee, and $50 more for the shipping and handling costs to get it to the store, and $50 more for a labor surcharge? Jeez.
Jeez. That about sums it up.
Update: My blogging colleague over at Flight Wisdom has weighed in with a few good points:
Janice would definitely see the fuel surcharge, which shows up in the farecalc line under the header Q, ie UA IAD Q5.00 87TA74N LHR (Just made that up as an example.) But, that makes it part of the base fare total on a ticket, not part of the tax calculation, which is separate.
Also, US DOT regulations require the fuel surcharge to be quoted as part of the advertised fare, although other countries, including EU ones, do not.
Also, look at her example…a flight to the UK. You may recall Gordon Brown, prior to his promotion, and a big to-do in the UK over raising airport taxes there to supposedly offset environmental factors. If you compared that tax assessment to London to one to another European
country, you’d see something of a difference. It is creating a situation where many people who used to change at Heathrow are routing to Amsterdam and other places.Fuel surcharges should just be reflected as fare increases, rather than creating a separate line item. But, officially, it is still part of the fare.
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{ 17 comments… read them below or add one }
I wish companies would realize again what the word ‘price’. It used to be the same as the amount of money a customer needed to hand over to get a product. Unfrotunately these days, it means: A random number that companies advertize with, and to which they will later add a number of ‘charges and fees’ in exchange for their product. What adds to it is this hypocritical air of ‘transparancy’. As a consumer I could not care less how a companiy spends my money. If I want to know that, I’ll get the annual report.
Why doesn’t the government enforce the law that consumers should get a product for the price that it is offered for?
Airlines do this because they know they can get away with it. The govt won’t help consumers because they are in bed with the airlines. In my mind, “fees” always mean extra profit!
This is the kind of thing that happens when business is unregulated…Princess accepted my deposit for a cruise in May at a specific price…nothing is mentioned in the contract whereby they informed me they can raise the price of my cruise for fuel increases…if everyone contracted their state’s attorney general office, maybe the travel industry will get a message we, as individuals, can’t impress upon them.
I agree 100%. These providers should only be able to advertize prices that are actually available for purchase, excluding government-imposed taxes and fees that are out of their control. This “fuel surcharge” gimmick is a fraud. I also object to the common practice of advertising fares as “each way based on round-trip purchase.” They should be required to give the round-trip price, unless the fare is really available as a one way purchase.
@ Dave: Why would the taxes and fees not be included? They are the same for every airline, and therefor can not be a competitive disadvantage. And what’s relevant for the customer is the final, total price. Not a random number lower than that.
It pisses me of massively that when I ask for a price, I am supposed to add all kinds of stuff to calculate how much money I am gonna loose. How the hell am I to know what I need to add? Just give me the grand total, and then I’ll decide whether I will take the product or not.
Ideally, the tacked-on fees should be the same between competitors.
I must agree, however, I would like to see the “price” plus all the applicable fees/taxes. I think reform is only possible when the customer sees all that they are paying for, and actually see how little of the ticket price actually goes to the airline.
What really upsets me is how do travel agents NOW go back to a customer to get more money?? We have already quoted them a price which we THOUGHT was the total and so did they. We cannot hardly take it out of the commission since that on most cruises is not much.
I say don’t tip the fuel surcharge amount and let there be mutany on the high seas with their workers.
Elliott,
I completely agree that the fuel surcharges are getting out of hand but I also just read in a Sydney newpaper that it would cost American Airlines LESS to gorund their flights for a day and refund the customer; than fly with the cost of fuel on long haul flights. With the price of oil and world currencies fluctuacting so much everyday how can the airlines stay competitive by just flat out raising prices. What if the price of oil drops? or the dollar changes? By no means am I on the side of the airlines, personally I think we should go back to having the airlines regulated again.
Thanks,
Jennifer Brown
Fairview Travel
Portland, OR
It should be noted that the cruise lines are doing the same thing with tax increases. Princes tried to do this to me before my last cruise, on the day that I made my final payment, and intered the penalty period when I couldn’t cancel without a fee. I asked my TA to help, and the only response that she got from Customer Service was “that’s our policy, and you can’t do anything about it”. I contacted them myself, and received the same response. I then contacted Jan Swartz, VP of Customer Relations, and I told him that without action on his part to remove the charge, my next contacts would be his boss, Alan Buckelew, and more importantly, well-recognized travel ombudsmen (Thanks, Chris!). The charges were promptly removed.
We were fully paid on Carnival Cruises as of Oct 19/07, for a cruise in Feb, 2008. Today we got invoiced an additional $80 “Fuel Surcharge”.
WE WON’T BE BENDING OVER FOR CARNIVAL EVER AGAIN!!!
Many have written the Fl. AG regarding the fuel surcharge imposed by the cruise lines. RCI’s contract clearly says that after deposit there can be no increases except for taxes and other government imposed fees. Carnival’s contract appears to allow a fuel surcharge, but they were party to a 1997 Fl AG settlement which did not allow, according to the AG press release, anything to be tacked on to the initial price except taxes and government fees, so the voidability of the language in their contract should be questioned since the initial price would not have included the surcharge (prior to the announcement).
People have received emails and phone calls form the Fl AG. According to a post at cruisecritic, a preliminary investigation of the cruise lines has been opened. My email said the matter had been referred to the economic crimes division.
If you have not yet filed a complaint with the Fl AG and your own state AG, you should do so, whether you are only deposited, or fully paid and being assessed this fuel charge.
I am so happy that you posted these articles. When my travel agent emailed me about the new cost of our RCCL cruise in Oct 08. I immediately asked how they could do that – that I wanted to see in their contract where they were able to this. I can’t deduct money from my cruise since I am paying more in fuel at home or traveling to the airport/cruiseline.
I emailed her copies of links from your articles asking her to go back to RCCL.
It’s good to see people are actually outraged by the blatant price-gouging on cruises. Carnival PLC’s and Royal Caribbean’s profits are up — but they claim to need additional money to stay afloat…. and we should believe this? It gets more absurd when Windstar, with 3 sailing vessels, jumps on the bandwagon for a $17 per day per couple “fuel” surcharge. Does the wind now cost more?
It seems the voice of Wall Street has spoken — the cruise lines need to make even more profits — and the cruising public… well, “let them eat cake.”
I agree with a previous statement…Carnival added $50 to my bill, I’m tipping them $50 less. After fully paying for my cruise, it is wrong to charge me more money!
BA and certain other airlines, as well as various cruise and other carrier companies have been legitimately caught and prosecuted for artificially imposing Q surcharges as fuel surcharges. By contrast, actual, legitimate Q surcharges ARE government imposed taxes. The airline does not get to keep that money – they must pass it on to the government in question. And no, they are not the same for all airlines in all markets.
I’ll give you one particular example to demonstrate my point.
There is a route that Singapore Airlines operates between Singapore (SIN) and Hong Kong (HKG). A passenger who flies that itinerary on one of Singapore Airline’s larger aircraft (a specific aircraft type) will be charged an extra $300 USD per direction as a fuel surcharge. It is imposed by the government responsible for fares to/from Hong Kong and only applies to planes of that particular type. By ‘odd coincidence’ only Singapore Airlines flies that route with those planes.
If you were to fly the same route on Singapore Airlines on a different aircraft type or with any other airline, that surcharge does not apply.
It is not something that the airline has a role in determining, and the airline does not get to keep the surcharge.
In neither case is the surcharge fair to the travelling public, however, as with regular gas taxes in most countries, it is unfair to blame the pricing on the airline when, in this example, Hong Kong requires an extra $600 per person for round trip flights on those particular aircraft. Other countries also have their examples of legitimately legislated government imposed surcharges and taxes.
Each country has their version of tax legislation in play. In some cases it is under the forum of ‘environmental protection.’ In others the words ‘fuel/energy conservation’ are used. For some the surcharges are called ‘luxury taxes’. Whatever the words used to describe them, the governments involved use those reasons for why they impose these additional fees, often as multiples of the actual base fare in net result.
In most cases, the airlines, in particular, are implementing the surcharges based on what is added to their base fares by a computer at IATA, who acts as the clearing house to distribute the funds to the airlines and the various governments in turn. In some cases, in particular, some airlines are implementing surcharges that are not government imposed surcharges (the example from this year is BA).
Bottom line – legitimate and costly surcharges are imposed most often by governments, not carriers. In those cases it is imperative to have governments reverse their position to end the penalizing of passengers for arbitrary legislative decisions.
For those airlines and carriers who are imposing illegitimate surcharges masquerading as legal government imposed ones, the flying public should ensure the carriers in question are made acutely aware of their displeasure.
We cruised in Feb. 08′ with Holland America. The cruise was paid in full in Nov. 07′. On the second day of the cruise we recieved a notice that our ship board account had been charged $70.00 for a fuel charge. This is really frustrating. Needless to say we will not be cruising again with Holland America or any other cruise line unless we know the exact price.
We’ve also been affected by the fuel surcharge on Discovery/Grand Scandanavian cruise. We’re charged AUD145p/p for a 18 night cruise (one night incidentally is in a London hotel). While I am objecting to this increase, I’ve been informed of another increase of $15 p/n unless I paid the balance by April 24 instead of the original date of 21 May. What are our rights?