Fie, fi, fo fum to fees

The airlines showed how it can be done: $5 here, $10 there, and suddenly it all adds up to billions of dollars. Now hotels are following in the carriers footsteps, often to the disdain of their customers.

US airlines collected more than US$1.5 billion in fees from consumers during the second quarter, according to a report from the Department of Transportation’s Bureau of Transportation Statistics (BTS).

Hotel fees are expected to hit a record $1.8 billion this year from a decade ago, reports a study by Bjorn Hanson, a hotel consultant and dean of the Preston Robert Tisch Center for Hospitality, Tourism and Sports Management.

Many of these are often hidden fees, reports CNNMoney.

Guests checking into the Quality Inn & Suites in Surprise, Ariz., for example, probably wouldn't expect to see a $1.50 "Safe Warranty" fee for use of the safe already in the room. The hotel introduced that fee this summer, according to the general manager of the property.

US airlines received $887 million from baggage fees and $612 million from reservation change fees in the second quarter. These are the only fees paid by passengers that BTS can currently identify separately. All other fees paid by passengers are combined in larger categories with other types of revenue.

“It is unclear how much revenue airlines generate from other ancillary fees such as pillow and blanket charges, food for purchase and priority boarding access,” writes the Houston Business Journal.

Delta collected the most baggage fees at $223.6 million. The airline took in $423.3 million through the first two quarters.

Coming in second was American at $156.1 million in the second quarter and $293.3 million in the second.

“While consumer outrage against airline bag fees in the US gets the most attention, airline reservation cancellation and change fees are holding their own and are huge,” writes Tnooz.

Cancellation and change fees rose 3.2 percent year over year to $612.3 million in the second quarter of 2011, according to BTS statistics.

"Passengers most certainly have not resigned to the fact that airlines continue to nickel-and-dime them when traveling," said Brandon Macsata, executive director of the Association for Airline Passenger Rights. "In fact, most passengers have expressed outrage that the airlines levy these fees yet customer service has continued to lag."

The charges to check luggage and change reservations are the only fees airlines are required to disclose to the federal agency. All other fees are combined in larger categories with other types of revenue.
 

In July, the US Transportation Department proposed a new rule requiring airlines to report 16 additional categories of fees, such as food, in-flight entertainment and seat upgrade charges.

The airlines have opposed the proposal, saying it would impose too much of a burden on the industry.
By David Wilkening