Advertisement

New regulations may lead to airline ticket ‘sticker shock’ [Updated]

Share

New federal regulations aimed at giving airline passengers the true price of their tickets when booking a flight may provide some travelers with an unpleasant surprise.

The new U.S. Department of Transportation rules that took effect last week require airlines to include taxes and fees in their advertised prices. But travel experts say they may have the unintended effect of reducing airline ticket sales by scaring away passengers with prices that suddenly seem much higher than in the past.

But the effect should be only temporary, said Anne Banas, editor of the travel review site SmarterTravel.com. “At first consumers might face a bit of sticker shock, as pricing will seem much higher upfront,” she said. “But ultimately it’ll be easier for them to compare prices across multiple airlines.”

Advertisement

Steve Lott, a spokesman for Airlines for America, the trade group for the nation’s airlines, said, “It’s basic economics that when consumers believe that the price of a product or service is higher, then there is the potential that demand will fall.”

Starting last Thursday, airlines were required to include all mandatory fees and taxes in all advertised prices. The airlines are not required to include optional fees, such as fees to check baggage or buy food or onboard entertainment, in the final price.

When the rule was proposed more than a year ago, the nation’s airlines protested, arguing that no other industry is required to wrap fees and taxes in advertised prices. Three carriers — Southwest, Spirit and Allegiant — filed a lawsuit to halt the rule. The lawsuit is still pending.

But Florida-based Spirit Airlines has gone a step further in its opposition. Spirit last week launched an online campaign, contending that the new rule is intended to hide federal taxes. The airline created a website, keepmyfareslow.org, where it suggested that the rule allows federal officials to “carry out their hidden agenda and quietly increase their taxes.”

Sen. Barbara Boxer (D-Calif.) lashed out at Spirit in a letter to the airline’s chief executive, Ben Baldanza, saying the carrier is misleading the public about the intention of the new rule. “I urge you to immediately send a clarifying email to your customers and remove the misleading information from your website,” she wrote in the letter.

Spirit spokeswoman Misty Pinson said she was disappointed in Boxer’s letter but refused to back down on the airline’s position. Pinson added, “We would welcome the opportunity to sit down with her and discuss the facts so she is fully informed.”

Advertisement

[Updated, 9:30 a.m.] A previous version of the story said the air fare advertising rule was imposed by the Federal Aviation Administration. It is a U.S. Department of Transportation rule. The previous version also said Steve Lott is a spokesman for the Air Transport Assn. The trade group changed its name last month to Airlines for America.

ALSO:

Some flight attendants want ’30 Rock’ off American Airlines

Several U.S. airlines raise fares

Fraudulent airline ticket orders on the rise, reporting group says

Advertisement