Can the government regulate fees for checked baggage? The Transportation Department has a canned answer

Wow, amazing that you were able to get any photography at all of DOT HQ….

Chris, apparently you are not familiar with how government regulations work. Regulations must exist within strictly-drawn bounds authorized by legislation. If the law does not authorize a rule, then the rule cannot be enacted. Period.

In the case of assistive devices, the Air Carrier Access Act (49 U.S.C. 41705) specifically prohibits discrimination against disabled individuals and gives the DOT authority to write rules implementing the act. The DOT has chosen to implement this by writing a rule (14 C.F.R 382.41) stating that assistive devices (necessary for a disabled person to take advantage of air travel) should not count towards a baggage limit. It also spells out how airlines should treat assistive devices; namely, they must be able to be gate checked, given priority over other baggage, etc.

There is no law authorizing the DOT to regulate prices charged for luggage, as long as the advertisement of the associated fare does not imply that luggage is included. Requiring air carriers to carry one piece of luggage for free (in any amount) is in effect mandating a price of zero for that service, which is something specifically prohibited by the Airline Deregulation Act.

I do think that charging for the first checked bag is stupid and unproductive and will only hurt carriers in the long run, but the airlines are well within the law, and the DOT has no means of writing rules to change this practice.

The solution for this is for carriers to either go bankrupt as their customers flee, or for Congress to write a law mandating that one piece of checked luggage must be included in air fares. The DOT can’t decide this sort of thing on its own.

@Chris

Actually, what they airlines will do is what they always do. The economic term is silent collusion. The regs will come out. Airline 1 will raise the rates by $15 across the board and put out a press release stating that they had to raise the rates because of the government regulation. Then the other airlines will either follow suit or not. If enough other airlines follow suit then it becomes a done deal.

In fact, they’ll probably list is at “Government mandated luggage fee”, or some other such spin.

As far as whether prices fell with unbundling or not, I just know that my $29.00 one way ticket to LAX from SFO last occured in 1992 and I have yet to pay more than $69 one way from SFO to LAX this year.

As I recall, deregulation came about because the national carriers were upset with Southwest which, at the time, flew entirely within Texas. Southwest was free to lower fares at will because, as an intrastate carrier, it was not under Federal regulation. National carriers felt this an unfair advantage in the lucrative short-haul business between Texas cities and lobbied to end fare regulation.

Now Southwest is a national powerhouse airline and most of the industry is struggling to survive. Be careful what you wish for.

To: Les Wilder

And yet those airlines which are less competitive with SW still reward their executives with salaries that are equal to or exceed those of SWs. Hmmmm?

Chris,
Remember my suggestion about weighing passengers and charging extra for anything over a certain amount? There’s an opportunity for unbundling: charge a low base rate for the seat, then treat the passenger like a UPS package: your height+width+depth must be no more than X inches and weigh no more than Y pounds (let’s say, the size of the average twelve-year-old girl), and otherwise, here’s the sliding scale for “oversize”. Then the airlines could advertise really, really low fares then :)

To me, the problem isn’t so much the unbundling. I just think that on any fare quote, any fee levied by the airline (as opposed to landing fees, etc.) which is levied on more than, say, 20% of the passengers in that fare bracket should be shown, alongside that fare, with the total of fare and fees shown, in the same size and color type. So if 20% or more of 21-day advance ticket purchasers on AA typically check two bags, then AA would have to show: Fare of X plus 1st checked bag of Y and 2nd checked bag of Z = Total (along with a note that you could avoid the bag fees if you didn’t check bags).

That should be required EVERYWHERE that fare is quoted – online, in print, on the phone, wherever. It’s just mandating disclosure, so it’s not telling the airlines what they can or can’t bundle, not telling them how much the fee can be – it just would mandate that the fee be constantly disclosed, every time the fare is quoted.

The idea on the 20% of a fare bracket is to keep the airlines from crowding in all the people who are exempt from the fees (elite FF members, business class fares, whoever) into the same category as ordinary travelers and perhaps avoiding the trigger to disclose.