Beginning Jan. 24, the Transportation Department will enforce a rule requiring that any advertised price for air travel include all government taxes and fees. For the last 25 years, the department has allowed airlines and travel agencies to list government-imposed fees separately, resulting in a paragraph of fine print disclaimers about charges that can add 20 percent or more to a ticket’s price.
But with airlines now promoting fares on Web ads, Facebook and Twitter, and adopting a menu of fees for services that used to be part of the ticket price, the government decided it was time for a change so travelers have a clearer sense of the total price they must pay. (The price will not include baggage fees, though, because they are optional.)
“Requiring all mandatory charges to be included in a single advertised price will help consumers compare airfares and make it easier for them to determine the full cost of their trip,” Bill Mosley, a department spokesman, said by e-mail in response to questions about the rule.
The government and the airlines are being guarded in discussing the full-fare advertising policy, since Spirit Airlines, Allegiant and Southwest have asked the United States Court of Appeals for the District of Columbia to block the proposed change, arguing that it violates their commercial free speech rights.
Spirit has built its business around advertising $9 fares, then charging additional fees for checked and carry-on bags, advance seat assignments and now a “passenger usage fee” of up to $17 each way for tickets booked online.
Since that online booking fee is technically optional — travelers can instead drive to the airport and buy a ticket there — Spirit is not required to include it in advertised prices. The proliferation of these types of fees has prompted the government to impose a growing number of fines against airlines and travel agencies that violate existing rules.
This year, the Transportation Department has assessed 21 penalties for fare advertising violations, with total fines of more than $1 million; in 2001, there were 14 penalties and $379,000 in fines.
Since August, Spirit, LAN Airlines, South African Airways, Orbitz, Virgin Atlantic, Thai Airways, JetBlue and Air Canada have all been fined at least $50,000 each for advertising infractions.
Under current regulations, ticket sellers may list government taxes separately on an ad promoting a fare, but those mandatory fees must be clearly disclosed — hence the asterisk pointing to additional text or a Web page that itemizes these charges. One of Spirit’s violations was advertising a $9 fare on Twitter and forcing customers to click links to two more Web pages to find out the full cost, including taxes and fees.
The new advertising rule is one of a dozen passenger protections the Transportation Department proposed in 2010 and adopted last spring. It extended the deadline for some provisions to give the airlines more time to comply.
Spirit and Allegiant have also challenged new rules requiring airlines to allow passengers to cancel a ticket purchase without penalty within 24 hours of booking; include information about baggage fees on e-ticket confirmations; and notify passengers more promptly about flight cancellations and delays.
Misty Pinson, a Spirit spokeswoman, said the airline could not comment on its objections to the new rules because of its coming stock offering. But in its S-1 filing with the Securities and Exchange Commission, Spirit cited “burdensome consumer protection regulations” as a risk factor for its business model, saying, “We are evaluating the actions we will be required to take to implement these rules, and we believe it is unlikely that we will be able to meet the 2012 compliance deadline in every respect.”
Article source: http://www.nytimes.com/2011/12/27/business/airfares-in-ads-soon-must-include-taxes-and-fees.html?partner=rss&emc=rss
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