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Senate subcommittee criticizes airline fee practices ahead of holiday travel

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Senate subcommittee criticizes airline fee practices ahead of holiday travel
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As the holiday travel season approaches, a recent report by a Senate subcommittee has sparked debate over the fee structures of major US airlines. The report, released by Senator Richard Blumenthal, Chair of the US Senate Permanent Subcommittee on Investigations (PSI), accuses airlines of imposing "junk fees" on passengers.

The investigation targeted three major carriers—American Airlines, Delta Air Lines, and United Airlines—and two low-cost carriers—Frontier Airlines and Spirit Airlines. According to Blumenthal, these airlines are exploiting passengers with additional charges and their representatives have been summoned to testify before the PSI.

One focus of the report is baggage policy enforcement. It highlights that Frontier and Spirit incentivize gate agents to enforce these policies, reportedly paying $26 million between 2022 and 2023 for this purpose. Frontier personnel can earn up to $10 for each bag checked at the gate.

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Another key finding is that seat fees have generated significant revenue for these airlines. Between 2018 and 2023, American, Delta, United, Frontier, and Spirit collectively earned $12.4 billion from seat fees alone. The report provides examples such as United charging up to $319 for extra legroom seats in 2023.

The use of algorithms to set dynamic pricing for carry-on and checked bags was also noted in the findings. This approach may result in varying prices for different passengers based on customer information.

Airlines for America responded critically to the report's conclusions, describing it as a misunderstanding of the sector's value during holiday travel discussions. Spirit Airlines defended its transparency in product pricing and compliance with regulations while disagreeing with several statements in the report.

Frontier commented on agent incentives stating: “The commission for gate agents is simply designed to incentivize our team members to ensure compliance with bag size requirements so that all customers are treated equally and fairly.”

A Senate hearing scheduled for December will further address these issues with testimonies from senior executives of five major US airlines including Steve Johnson from American Airlines; Peter Carter from Delta Air Lines; Andrew Nocella from United Airlines; Robert Schroeter from Frontier Airlines; and Matthew Klein from Spirit Airlines.

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