Airlines to be grilled on Capitol Hill over rising add-on fees

04.12.2024 - 13:39 / thepointsguy.com / Spirit Airlines / Richard Blumenthal / United S.Airlines / Frontier Airlines

Executives from five major U.S. airlines are set to be grilled Wednesday on Capitol Hill over those pesky add-on fees that regularly cause passengers to pay far more than the base price of a plane ticket.

A Senate subcommittee will hear testimony from leaders of American Airlines, Delta Air Lines, United Airlines, Frontier Airlines and Spirit Airlines over the growth in ancillary fees paid by customers — costs that now stretch well beyond checked bags to other "extras" like selecting a seat or, on some restrictive tickets, bringing a full-size carry-on bag on board.

The hearing comes after a scathing report released last month by the Senate Permanent Subcommittee on Investigations, which criticized the billions of dollars in add-on fee revenue pulled in by airlines in recent years, "obscuring the total cost of travel" and making it more difficult, the report argued, for customers to comparison shop.

"Our investigation has exposed new details about airlines exploiting passengers with sky-high junk fees," Sen. Richard Blumenthal, a Democrat from Connecticut and the chair of the subcommittee, said in a Nov. 26 statement. "I will be asking airlines to justify these practices."

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A trade group for the largest U.S. carriers said the organization was "deeply disappointed" in the report which, it said, showed a misunderstanding of the airline industry.

"Today, U.S. airlines are providing more options and better services while ticket prices, including ancillary revenues, are at historic lows," Airlines for America said in a statement to TPG this week.

As part of a yearlong investigation, lawmakers found American Airlines, Delta Air Lines, United Airlines, Frontier Airlines and Spirit Airlines generated $12.4 billion in seat fee revenue between 2018 and 2023. That's on top of more than $25 billion in bag fee revenue reported by those carriers to the U.S. Department of Transportation during that same time frame.

The report scrutinized Frontier and Spirit, the nation's largest ultra-low-cost carriers, for incentive-based programs it alleged paid gate agents millions of dollars in commissions when customers paid for bags or other ancillary costs at the airport.

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It also called on Congress to mandate that airlines offer clearer data on just how much ancillary revenue they collect from "extra" charges; today, airlines report checked bag fee totals to the government but don't face the same disclosure requirements for the growing amount of other non-fare revenue they pull in.

Airlines first added checked bag fees in