INTEREST GROUPS SEEK TO CAP CHANGE FEES IN FOREIGN AIR TRANSPORTATION AND BETTER REGULATE FUEL SURCHARGES
March 6, 2015
On February 11, 2015, FlyersRights.org, a nonprofit airline passenger organization, submitted a petition to DOT requesting that a $100 cap be placed on change fees for foreign air transportation. International change fees have increased to as much as $750 in recent years.
Carriers generally opposed the petition, arguing that lower change fees will encourage consumers to “speculatively” purchase tickets far ahead of actual travel, and that high change fees are necessary due to the potential lost revenue associated with customers purchasing cheaper regular fares rather than high priced flexible or refundable fares. Carriers further argue that change fees are meant to discourage itinerary changes after a purchase has been made.
FlyersRight.org notes that even if a passenger changes flights, the airline can resell the seat to another passenger and generate revenue from the original passenger on their new flight. FlyersRights.org also noted that on average, a refundable ticket is 350% more expensive than a non-refundable ticket and purchasing refundable tickets at such a high cost is not an option for most customers.
A second initiative, targeted at the sizeable fuel surcharges charged by many airlines, was brought by the Business Travel Coalition (BTC). BTC argues that the industry practice of billing consumers for fuel surcharges violates DOT’s 2012 guidance that such surcharges must be tied to the actual cost of fuel.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com, 202-659-6622) or Drew Derco (dderco@eckertseamans.com, 202-659-6665).