Senate tries to stop airline fees

The U.S. Senate is taking a surprise stand against airline fees.

The Forbid Airlines from Imposing Ridiculous Fees Act of 2016 (FAIR Fees Act), introduced this week, would prohibit air carriers from imposing fees that are “not reasonable and proportional” to the costs incurred by the air carriers. And the Senate version of the Federal Aviation Administration reathorization bill, also introduced this week, contains a provision that would commission a government study on how air carriers calculate some of their most profitable fees.

The proposed laws came as a surprise to industry observers, who are accustomed to a hands-off approach to regulating airlines. Taken together, the developments suggest that even in a Republican-controlled Congress, there’s a limit to what the airline industry can get away with.

Grounding “soaring” fees

Fees are a chronic source of complaints among constituents. Airlines have sought to inoculate themselves from regulation by waiving ticket change fees for members of Congress and with generous campaign donations. But now, even that appears to be insufficient to stop proposed regulation.

“This measure will ground the soaring, gouging fees that contribute to airlines’ record profits and passengers’ rising pain,” said Sen. Richard Blumenthal (D-Conn.), who co-sponsored the Fair Fees Act. “With all the frills of flying already gone, airlines are increasingly resorting to nickel and diming consumers with outrageous fees.”

Take checked baggage fees, for example. Between 2009 and 2014, three airlines increased checked baggage fees by 67 percent, a recent investigation by the minority staff of the U.S. Senate Commerce, Science and Transportation Committee found. It’s a jarring increase, when you compare the modest $464 million earned in 2007 to 2014’s astonishing $3.5 billion. In the past, airline executives have said fees like this can represent the difference between a profit and a loss.

Blumenthal also notes that four airlines increased domestic cancellation fees by 33 percent between 2009 and 2014, while one increased the fee by 50 percent, and one increased its fee by 66 percent, according to the Senate study. The numbers are dramatic here, too — cancellation fees skyrocketed from just $915 million in 2007 to $2.9 billion in 2014.

It’s difficult to argue that the airline’s cost to transport a checked bag or make a ticket change has increased by that much in just a few years, according to Blumenthal. He says these “runaway” fees can, in some cases, double a passenger’s airfare, and that people who are least able to afford them — non-elite level parents who are traveling with young children — are hardest-hit.

“A parent who wants to sit with his young child, a customer who wants to check or carry on a bag, or have Wi-Fi, or a traveler who needs to change or cancel a reservation should not incur exorbitant, unnecessary fees on the whim of an airline,” he adds.

An airline industry representative predicted that regulating fees would lead to higher fares.

“When the government last dictated airline pricing, many couldn’t fly because it was cost prohibitive,” warned Jean Medina, a spokeswoman for A4A, a trade association for airlines. “Customers have choices today. They can purchase non-refundable fares that are highly affordable. If they would like the flexibility to change their ticket at the last minute, they can do so as well.”

Undermining the airline business model

The measures would effectively undermine the airline industry’s current business model of “unbundling” fees from their base fares. That effectively keeps airfares low, while charging consumers for extras that used to be included in their ticket, like a seat assignment, a checked bag, and in extreme cases, a carry-on bag or the ability to print a boarding pass.

Airlines argue that these “à la carte” fees should be optional, but they effectively increase the price of a ticket and take advantage of a perception among many passengers that airline tickets still include many of the amenities stripped away long ago. What’s more, say advocates, the fees have little or no relation to the actual costs of providing the services — in other words, they are often pure profit to the airline.

The FAIR Fees Act would require the Secretary of Transportation to create a regulation prohibiting an air carrier from imposing fees that are unreasonable or disproportional to the costs incurred by the air carrier. It would also establish standards for assessing whether such fees are reasonable and proportional to the costs incurred by the air carrier.

The bill would cover any fee for a change or cancellation of a reservation for a flight, any fee relating to checked baggage, and “any other fee” imposed by an air carrier. More importantly, it requires airlines justify the fees, demonstrating they would have lost money by the cancellation or were unable to resell the seat. Airlines would also have to show the actual cost of transporting luggage, including labor costs. It requires the Transportation Secretary to set standards for the fees, effectively regulating what airlines can — and can’t — charge.

Airlines will only be authorized to charge fees that cover the costs of the baggage handlers, ticket agents, baggage processing, or anything that reasonably pertains to checking a bag. For example, American Airlines, Delta Air Lines, and United Airlines currently charge more money for the second checked bag than the first, yet there appears to be no appreciable cost increase for processing the second bag, according to Blumenthal.

For change and cancellation fees, airlines would only be authorized to charge fees that cover the cost of processing the new tickets and any potential loss of revenue due to the cancellation, since any loss of revenue would be minimal or even zero because the airline can resell the seat for a potentially higher fare.

“Airlines may wish that they could charge whatever they want, but even in markets in which fares have been deregulated, U.S. law still prohibits unfair and deceptive practices,” says Edward Hasbrouck, a consumer advocate and airline industry observer. “The problem has been in getting the reluctant Department of Transportation to exercise its authority to determine which fees are unfair or deceptively-labeled.”

The FAIR Fees Act, if passed, would give the DOT that authority, he says.

The proposed law could get additional help from the just-introduced Senate version of the FAA reauthorization bill, which contains a provision that would require the Comptroller General of the United States to conduct a study of existing airline industry change and cancellation fees, and the current industry practice for handling changes to or cancellation of ticketed travel on covered air carriers. The bill asks the Comptroller General to consider whether and how each airline calculates its change and cancellation fees, and the relationship between the cost of the ticket and the date of change or cancellation as compared to the date of travel.

Airline supporters are likely to argue that limiting fees restricts a free market. But Kevin Mitchell, chairman of the Business Travel Coalition, says the current, consolidated airline industry is not competitive.

“In a perfectly competitive market, an airline industry consumer would be able to exercise his right to walk away from the $200 change fee and instead deal with other airlines eager to gain market share,” says Mitchell, whose group represents corporate travelers. “However, now that the U.S. marketplace has gone from 11 airlines controlling some 80 percent of seat capacity to 4 airlines, the opportunities to vote with one’s wallet have been considerably reduced.”

Whether these bills succeed or not, one thing seems clear: The days of airlines naming their own price when it comes to fees and surcharges are numbered.

Should airline fees be regulated?

View Results

Loading ... Loading ...

Underwritten by

Elliott Advocacy is underwritten by

With nearly 20 years in the industry, over 128 airport covered in the U.S. and Canada, and over 1,000 Hotel and Parking Partners-we provide travelers the best options on how to get to the airport when flying. Whether you want to; drive yourself and park near an Airport (Airport Parking), stay the night before your flight at an airport hotel and leave your car (Hotel and Parking Package), or take a shared Shuttle/Private Car/Limo to the Airport- we got you covered. The best deals can be found online, and booking a reservation has never been easier. You can explore all of our options by visiting us at,,, and

Elliott Advocacy is underwritten by Cavalry Travel Insurance

Cavalry takes the worry of out travel by providing 24/7 access to medical and security professionals combined with the best medical evacuation and security extraction services. Cavalry gets you home safely when you need it most. Learn more at

Elliott Advocacy is underwritten by Seven Corners

Seven Corners has helped customers all over the world with travel difficulties, big and small. As one of the few remaining privately owned travel insurance companies, Seven Corners provides insurance plans and 24/7 travel assistance services to more than a million people each year. Because we’re privately held, we can focus on the customer without the constraints that larger companies have. Visit Seven Corners to learn more.

Elliott Advocacy is underwritten by Sodexo North America

Sodexo North America Sodexo North America is part of a global, Fortune 500 company with a presence in 80 countries. Sodexo is a leading provider of integrated food, facilities management and other services that enhance organizational performance, contribute to local communities and improve quality of life for millions of customers in corporate, education, healthcare, senior living, sports and leisure, government and other environments daily. Learn more at

Elliott Advocacy is underwritten by Travelex Insurance Services

Travelex Insurance Services is a leading travel insurance provider in the United States with over 55 years combined industry expertise of helping people dream, explore and travel with confidence. We offer comprehensive travel insurance plans with optional upgrades allowing travelers to customize the plans to fit their needs. Compare plans, get a quote and buy online at

Elliott Advocacy is underwritten by AirHelp

AirHelp is the world’s leading flight delays compensation company, helping passengers apply for compensation following a delayed or canceled flight or when boarding has been denied. It is AirHelp’s mission to fight for passenger rights by holding airlines accountable for flights disruptions that are out of passengers’ control. AirHelp has already helped 5 million people, taking the stress out of applying for compensation and making it as hassle-free as possible for travelers around the world.

Elliott Advocacy is underwritten by Allianz Travel Insurance

The Allianz Travel Insurance company has built its reputation on partnering with agents all around the world to provide comprehensive travel insurance for their clients. Contact Allianz Travel Insurance for a comprehensive list of coverage.

Elliott Advocacy is underwritten by Chubb

Chubb is the world’s largest publicly traded property and casualty insurance company, and recognized as the premier provider of insurance for successful individuals and families in the U.S. and selected international markets, offering coverage for high-value automobile, homeowners, recreational marine/aviation, valuables and umbrella liability coverage. As an underwriting company, Chubb assesses, assumes and manages risk with insight and discipline, and combines the precision of craftsmanship with decades of experience to conceive, craft and deliver the best insurance coverage and services to individuals, families and business of all size.

Elliott Advocacy is underwritten by Fareportal

Fareportal’s portfolio of brands, which include  CheapOair and  OneTravel, are dedicated to helping customers enjoy their trip. Whether you want to call, click, or use one of our travel apps, one thing is clear: We make it easy to take it easy.

Elliott Advocacy is underwritten by

An independent provider of low cost CDW/LDW insurance for use with rental cars. Up to $100,000 cover with no deductible. Policies available on a per day, per trip or per year basis. Also works with overseas rentals. Try  Insuremyrentalcar.comnow.

Elliott Advocacy is underwritten by

Since its inception over three decades ago, G1G has continued to revolutionize the travel insurance industry by being the only aggregator to operate a customer portal, placing all of the user's primary needs in one place. We have continued to innovate and disrupt the market by reimagining the way travel insurance can be delivered to the end user in ways no competition can. Simply put, no one knows the market as well as its founders and no one else shares G1G values and mission.

Elliott Advocacy is underwritten by Mediacom Communications

The nation’s fifth-largest cable operator, serving the smaller cities and towns in the Midwest and Southern regions of the United States. We are a high-performance broadband, entertainment, and communications company that brings the power of modern technology and quality customer experience to life inside the connected home by combining ultra-fast gigabit speeds with personalized local and over-the-top entertainment choices that fit your lifestyle. Details at

Elliott Advocacy is underwritten by Arch RoamRight

Arch RoamRight is one of the fastest growing, most-highly rated travel insurance companies in the United States. Travel advisors love working with us, and travelers feel protected with our trip cancellation and travel medical insurance coverage. We also make it easy to file a claim online with our fast, paperless claims website. Learn more about RoamRight travel insurance.

Elliott Advocacy is underwritten by Virtuoso

The leading global network for luxury and experiential travel. This invitation-only organization comprises over 1,000 travel agency locations with 17,500 advisors in over 45 countries, and holds preferred relationships with 1,700 of the world’s finest travel companies. Virtuoso advisors collaborate with their clients to create personalized itineraries featuring exclusive perks, while also providing advice, access, advocacy, and accountability. For more information, visit

Elliott Advocacy is underwritten by VisitorsCoverage

As a company that is constantly striving to simplify travel insurance, VisitorsCoverage, is on a mission to help travelers make the better decisions about purchasing travel insurance, quickly. VisitorsCoverage has helped millions of travelers globally to buy the suitable travel insurance and explore the world with confidence. Get insurance for your next trip at  VisitorsCoverage. Lowest Price Guaranteed.

Elliott Advocacy is underwritten by MedjetAssist

Medjet is the premier global air-medical transport, travel security and crisis response membership program for travelers. With a MedjetAssist membership, if you become hospitalized more than 150 miles from home, we will get you from that unfamiliar hospital all the way home to the hospital you trust. All you ever pay is your membership fee. MedjetHorizon members add 24/7 personal security and crisis response benefits. readers enjoy discounted rates. Travel safer with  MedjetAssist.

Elliott Advocacy is underwritten by Southwest Airlines

The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit. We are committed to provide our Employees a stable work environment with equal opportunity for learning and personal growth.

Elliott Advocacy is underwritten by makes it fast and easy to compare and buy travel insurance online from top rated providers. Our unbiased comparison engine allows travelers to read reviews, compare pricing and benefits and buy the right policy with a price guarantee, every time. Compare and buy travel insurance now at

Elliott Advocacy is underwritten by Squaremouth

Squaremouth helps travelers easily and instantly compare travel insurance policies from all major providers. Only companies that meet the strict requirements of Squaremouth’s Zero Complaint Guarantee are available on the website. Compare policies on to save over 70 percent on your next purchase.

Elliott Advocacy is underwritten by Travel Leaders Group

Travel Leaders Group is transforming travel through its progressive approach toward each unique travel experience. Travel Leaders Group assists millions of travelers through its leisure, business and network travel operations under a variety of diversified divisions and brands including All Aboard Travel, Andrew Harper Travel, Colletts Travel, Corporate Travel Services, CruCon Cruise Outlet, Cruise Specialists, Nexion, Protravel International,, Travel Leaders Corporate, Travel Leaders Network and Tzell Travel Group, and its merger with ALTOUR. With more than 7,000 agency locations and 52,000 travel advisors, Travel Leaders Group ranks as one of the industry’s largest retail travel agency companies.

Elliott Advocacy is underwritten by Travelers United

If you’ve been mistreated by the airlines, Travelers United is your voice in Washington. Join the #1 travel advocacy organization working with Congress to improve and protect travelers. Plus, get $400 of annual benefits you can use for travel for only $29/year. Add your voice to ours. Make travel better.  Join today.

Send this to a friend