Wyden Bill to Curb Airline Price Gouging

On November 20, Senator Ron Wyden introduced legislation that would prohibit airlines from charging fees – including cancellation, change and bag fees – that are not reasonable and proportional to the costs of the services actually provided.  

“Airlines are committing highway robbery when they blindside passengers with unexpected and unscrupulous fees,” Wyden said. “The American consumer deserves far better, especially during the holiday season when families and loved ones are reuniting and air travel is stressful and costly enough without surprise costs.”  

The Forbidding Airlines from Imposing Ridiculous (FAIR) Fees Act also directs the Department of Transportation to review any other fees charged by airlines. Too often, airlines blindside travelers with exorbitant charges at checkout caused by unexpected fees for basic aviation services. This price gouging has exponentially grown as a business practice over the last decade. The top ten airlines worldwide collected $35.2 billion in ancillary fees in 2018, up from just $1.2 billion in 2007. In the first two quarters of 2019, U.S. domestic airlines collected $2.8 billion and $1.4 billion in baggage and reservation fees, respectively. With the busiest travel season of the year still ahead, both of these figures are on track to reach all-time highs by the end of 2019.  

Wyden joined U.S. Sens. Edward J. Markey, D-Mass., Richard Blumenthal, D-Conn., and Sheldon Whitehouse, D-R.I. to introduce this bill in the Senate. The bill was also introduced in the House by U.S. Reps. Steve Cohen, Jesús García, Albio Sires, Eleanor Holmes Norton, Mark Takano, Jan Schakowsky, Bobby Rush, Barbara Lee, Rashida Tlaib, Bennie Thompson, Raúl M. Grijalva, and Gwen Moore.  

The FAIR Fees Act is endorsed by the National Consumers League, Consumer Reports, Consumer Action, Consumer Federation of America, U.S. Public Interest Research Group, Travelers United, Business Travel Coalition, Flyersrights.org, and Airlinepassengers.org.  

“Add-on airline fees should be transparent and fair,” said Susan Grant, Director of Consumer Protection and Privacy at the Consumer Federation of America. “Passengers shouldn’t be gouged when they need to change their plans or can’t fit their baggage into ever-shrinking overhead space.”  

“Airlines have raised their fees sky high, forcing travelers to pay more and more for basic services that used to be included in the price of a ticket,” said Anna Laitin, Director of Financial Policy at Consumer Reports. “This bill will help bring fees back down to earth by requiring airlines to make them transparent, reasonable, and proportional to the real cost of providing the service.”  

“Airlines are overcharging consumers with fees that are grossly disproportionate to the value of the service received and result in a windfall for airlines. ‘Exhibit A’ is change fees, where airlines charge $200 when the true cost of a change is 6 to 7 times lower, if not zero,” said Kevin Mitchell, Founder of the Business Travel Coalition. “This kind of unconscionable consumer price gouging is a textbook example of unfair methods of competition that underpin competition laws.”  

“FAIR Fees will be a strong dose of common sense for an industry that has become far too consolidated,” said Charlie Leocha, President of Travelers United. “When the major airlines can move in ancillary-fee lockstep without regard for actual costs the market system is clearly broken. If the pricing systems were working, we would not require congressional action. Unfortunately, since the country has been faced with airline merger after merger this bill has become necessary.”  

A copy of the bill text is available here.