Bob CollinsThe General Accounting Office today released a report saying consumers are having a difficult time shopping for airline fares, because the different fees make it tough to do so.
The reality? It’s much worse than that.
Here’s an example: Over several weeks I watched fares for a flight from Minneapolis to Boston in August, because one of my sons and his girlfriend want to visit family there. Using several online services, I tracked a fare on Delta for an August flight that went from $450 in early June, to about $273 a week ago. “Yahtzee,” I thought as I grabbed the credit card and started making reservations.
After hitting the “submit” button, a message in red letters declared, “We’re sorry. The fare for this flight has changed.” Really? At 11:30 at night?
What was really going on here? The airline had actually only put one seat on the entire flight for sale at $273; legally it could advertise a fare of $273. Once that seat was sold, the published fare went to $450. So I bought two tickets — one for $273 and one for $450.
Just for the heck of it, I checked the price again today. It’s now going for $233. But check the notation: “One seat left.”
One seat left? There was only one seat at that price in the first place.
A savvy traveler who doesn’t mind gambling on leaving a girlfriend stranded at an airport waiting for another flight, could game the system, perhaps, by buying one seat, waiting a day until the airline puts the single-seat up for sale at the lower price again, and then buying the second seat. And that works, unless the flight sells out and then you’re stuck with two people going on vacation and only one airline ticket, which is bad for a relationship. Another option is simply to live a life of isolated loneliness, and travel by yourself.
There’s nothing about this problem in today’s GAO report, however (which you can find here). Instead, it appears to focus more on an issue that is more important to the government, than it is to the consumer: The airlines are using the fees to avoid paying taxes because while the revenue they derive from tickets is taxable, revenue from fees is not.
Still, the GAO report to Rep. Jim Oberstar, DFL-Minnesota, points out good reasons to require more transparency on fees:
GDS and travel agent representatives say that there is little incentive for airlines to disclose their fee information through the GDSs as such disclosure will increase the fare displayed to many passengers if fees are included. Airlines largely compete on fares and passengers compare fares when deciding which flight to purchase, often picking the lowest fare displayed. If one airline provided fee information and another did not, the airline that disclosed the fees would be at a disadvantage. Consequently, according to GDS representatives, it is unlikely that airlines will provide fee information or offer these services for sale through GDSs unless required to do so. In addition, trade associations are advocating that the airline industry work to standardize policies on fee disclosure and access. For example, the Interactive Travel Services Association, Business Travel Coalition and American Society of Travel Agents are leading efforts to have all fees available for sale through GDSs and to establish uniform codes for fee transactions. Similarly, the National Business Travel Association has supported efforts to make fees for services available through GDSs so that corporate travel agents can access and monitor fees when they are instituted or changed, buy services, and track them through their expense management systems
But whatever rules Oberstar’s committee may propose to make it easier for consumers to compare fares, history suggests the airlines will figure out another way to get around them.
In the meantime, if you want to practice booking airline travel online, perhaps this primer will be helpful:
