Fee Deceptions Are Getting Worse, Not Better

In their ongoing war with travel suppliers, consumers win some, lose some. One basic struggle is that many (probably most) consumers want to be able to compare fares, rates, and prices from a wide range of suppliers on a consistent basis, but suppliers want to make their services look cheaper than the other guy's. And although consumers have won some battles, others remain to be fought. 

Airlines

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You may have thought that current Department of Transportation rules pretty much assure consistent airfare comparisons, but fees continue to cloud the picture. Yes, the DOT prevents airlines from using split pricing (carving out part of the true price, giving it a label such as "fuel surcharge," and initially highlighting only the reduced lower figure). Now, airlines have to include all mandatory fees in their featured prices, including even taxes, and you no longer have to worry about at least one major source of deception.

But "optional" fees remain an obstacle for true fare comparisons. Fees for common options such as checked baggage, advance seating assignment, and onboard drinks/snacks vary from "included in the fare" to outrageous, depending on the individual airline, the class of ticket you buy, and your frequent-flyer status. What you'd like to do is enter the options you want and get a side-by-side display of total costs, including whatever fees apply. You'd think that the big online travel agencies (OTAs) such as Expedia could easily do just that: add a simple fee-lookup table to their search engines and display consistent fare-plus-fee totals. Unfortunately, say the industry types, the back-room IT problems are far too complicated. 

And the situation is likely to get worse. Folks I know in the industry are saying that the airlines are starting to "yield manage" their optional fees: Instead of setting fixed prices, they vary the price depending on the route, day of week, time of day, and expected load factor. In short, fees will likely soon become a moving target that no simple lookup table could accommodate.

Hotels

The hotel situation is worse than the airlines. No federal or state agency provides oversight of hotel pricing the way the DOT does for airlines, so many hotels routinely engage in price-splitting. Those culprits hide their true rates by slicing a part of the real price off, labeling it as a "resort" or "housekeeping" fee, and featuring the incomplete price. Moreover, hotels almost never include state and local taxes in their highlighted rates. And although laws require that European hotels include the VAT in the rates they post locally, some chains and OTAs exclude VAT from the European rates they display to U.S. travelers.

Digging Out the Truth

All airline and most hotel websites display the amount you really have to pay before you click the "buy" button. But you typically have to go through several screens (maybe even entering all that tedious personal information) before you learn the true price. Moreover, some hotels don't spring the specific fee until you actually arrive at the hotel. Accordingly, some OTAs admit they can't display all those fees even after you buy; instead, they weasel out with a "disclosure" that you may have to pay extra fees.

The upshot is that you really have to work for a rigorous price comparison. An OTA website can narrow down your options, but you have to check with a supplier's own website (and even go through all the information entry hassle) until you arrive at the actual "buy" sheet and finally see the real price. Moreover, you have to do that separately for each option you want to check. And if you book a hotel through an opaque site such as Priceline, you have to figure that a price you "bid" probably excludes taxes and fees.

All in all, at least with airfare, DOT rules give you some protection against the most egregious deceptions. But nobody is policing the hotels, so "caveat emptor" remains the rule of the day.

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Ed Perkins on Travel is copyright (c) 2012 Tribune Media Services, Inc.

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