June 21, 2024

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Airlines are trying to stop Biden from enforcing ‘junk fees’ rule

3 min read

Several of the country’s largest airlines are challenging a new Biden administration rule that would force them to disclose certain fees as part of the upfront cost of airfare. The government describes these charges, which are added for luggage and changes to reservations, as “surprise junk fees.”

In a petition filed Friday in the U.S. Court of Appeals for the 5th Circuit, the trade group Airlines for America and six airlines asked for the ancillary fee rule to be vacated because they say it is “arbitrary, capricious” and outside the authority of the Transportation Department.

The group of airlines on the petition includes American, Delta, United, JetBlue, Alaska and Hawaiian. In a statement Monday, Airlines for America said implementing the rule will only confuse customers and complicate shopping for flights.

“The DOT ancillary rule is a bad solution in search of a problem,” the statement said.

The rule was finalized last month after an 18-month process and is set to go into effect on July 1. The Transportation Department says it could save consumers more than $500 million a year. According to the Bureau of Transportation Statistics, airlines collected nearly $5.5 billion in baggage fees last year.

“We will vigorously defend our rule protecting people from hidden junk fees and ensuring travelers can see the full price of a flight before they purchase a ticket,” the Transportation Department said in a statement responding to the lawsuit. “Many air travelers will be disappointed to learn that the airline lobby is suing to stop these common-sense protections.”

Under the rule, airlines or travel booking sites will be required to show fees for checking a first or second bag, carrying on a bag, changing a reservation or canceling a reservation the first time the fare is provided. Several airlines have recently raised the price to check a bag — and some fees vary depending on the flight.

Consumer advocate John Breyault, vice president of public policy for the National Consumers League, said he was disappointed but not surprised to see the lawsuit. He said the benefit of the rule to passengers is that it makes it easier for travelers to do an “apples-to-apples comparison” of flight costs.

“Now they’re going to have to tell you a truer cost up front,” he said.

When it announced the rule, the Biden administration said it would put an end to “discount bait-and-switch tactics” that could lead consumers to believe they were getting a better deal than the final price after fees. Airlines for America said carriers have already made significant investments in their websites and apps to make it easy for passengers to book tickets tailored to their specific needs — with fees disclosed before a purchase is made.

“Airlines go to great lengths to make their customers knowledgeable about these fees,” its statement said. “In addition to the disclosures required by existing DOT regulations, airlines engage in competitive advertising and emphasize ancillary fee discounts and benefits when they promote their loyalty programs.”

In comments submitted as part of the process of making the new rule, Airlines for America argued that carriers are motivated to provide good service by their own success, not government mandates. The rule, they said, “would mandate clutter and clunky search protocols causing delayed and unclear search results, neither of which consumers want or need.”

The Biden administration’s campaign against “junk fees” has extended beyond airlines to credit card late fees, resort fees, cable company charges and convenience fees for tickets to live events.

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