Americans have been nickel and dimed by the travel industry, since airlines began charging for checked baggage four years ago. We wondered how many business trips and vacations are busting budgets because of the hidden taxes and fees sneaking into plane tickets, hotel rooms, credit cards and a host of other travel expenses.
Stealth charges are boosting the industry's bottom line: Hotels saw a 9.8 percent uptick in revenue in 2010, according to a report by PKF Hospitality Research, and airlines raked in $22 billion last year from ancillary fees. Checked bag fees alone generated nearly $3.4 billion in 2010, up from $464 million four years ago. But consumers are not happy. “There’s a huge amount of revenue being collected through those fees and our clients and travelers feel a huge resentment,” said Alex Trettin, president of Travel Center Inc., a Tacoma, WA based travel agency.
Airlines and hotels are not the only services adding new charges to their core prices. From $4.99 a minute phone charges, to $10 security fees, here’s a look at some hidden travel costs that can add hundreds of dollars to your trip's total price tag.
Often, travelers see a low fare online and jump at the apparent bargain, but the deal is rarely that good. Earlier this month, American Airlines listed one of its New York-to-London flights for October at just $139 round-trip, but the actual price swells to $664.20 with taxes and fees.
Extra charges are not typically fully broken down for the average consumer to see, but In this case, some coded fees popped up for the travel agent who found the deal in his system. For example, the total “YQ” charge on the flight, a code for international insurance tax by some airlines, was $362 and a fee labeled “GB,” the taxes and fees for U.K.-departing flights, tacked on another $97.80, in addition to smaller ones that quickly added up.
The extra cost includes airport fees, destination taxes, entry and exit fees, security fees and fuel surcharges. For example, a security fee implemented shortly after 9/11, costs up to $10 per round trip for transportation that originates in the U.S. (broken down, it’s $2.50 each time a customer boards a plane, up to two boardings per one-way trip). This past winter many airlines added fuel surcharges ranging from $4 to $10 per roundtrip to combat rising oil prices. Airlines aren’t required to give a detailed breakdown of fees; instead, they're bundled and coded in such a way that travelers can't understand what they're paying for.
Spirit Airlines charges $33 for the first checked bag with online check-in and $38 for check-in at the airport counter. Spirit also charges $30 for carry-on bags (but not “personal items” like purses) with online check-in, compared with $35 at the counter. The average cost at most airlines for a single checked bag is about $25, and a few remaining carriers still offer free checked baggage, like Southwest Airlines and JetBlue, but those days could be numbered.
Airtrain, Continental and United each charge $100 for checked bags weighing 51-70 pounds, topping other airlines. Delta and US Airways are close behind, charging $90 each for checked bags in the same weight range. Average cost among all carriers is about $50.