Airlines make billions charging ‘junk fees,’ congressional report says

(CNN) — Airlines have pocketed billions of dollars in so-called “junk fees” by charging customers extra to select a seat or to carry on bags, according to a Senate subcommittee report published on Tuesday.

The report said some airlines have even paid workers cash incentives to identify customers trying to avoid fees for carry-on bags.

From 2018 to 2023, five US airlines made more than $12 billion on seat selection fees alone, an “unbundled” cost that used to be included as part of an airline ticket.

The report, from the Senate Permanent Subcommittee on Investigations, said that in 2023, United Airlines charged as much as $319 for an extra legroom seat, Spirit Airlines charged as much as $299, Delta Air Lines charged as much as $264, Frontier Airlines charged $141 and American Airlines charged as much as $140.

“Seat fees have grown more expensive and farther-reaching,” it said. “These five airlines charge passengers extra for additional legroom, aisle and window seats, or even selecting a seat in advance, compelling parents with minor children to pay to sit together.”

The 55-page report comes as the outgoing Biden Administration takes a victory lap for its crackdown on airlines by ramping up consumer protections. Earlier this month, the Department of Transportation announced it would begin enforcing a new rule that requires airlines to provide automatic refunds to passengers for canceled or significantly delayed flights.

The report detailed measures some airlines took to ensure passengers pay for carry-on bags. It stated that ultra-low-cost carriers Frontier and Spirit shelled out $26 million in incentives to spur agents in 2022 and 2023 “to catch passengers allegedly not following airline bag policies, often forcing those passengers to pay a bag fee or miss their flight.”

“Frontier personnel can earn as much as $10 for each bag a passenger is forced to check at the gate,” the report said. “One Frontier official told the Subcommittee that bag policy enforcement was necessary because the airline does not want customers to be taking more or ‘stealing’ from the airline.”

Frontier acknowledged the practice in a statement to CNN. “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, including the majority who comply with the rules,” the statement said

Spirit Airlines did not immediate respond to a request for comment.

Democratizing travel?

The report also said some airlines appeared to be avoiding federal taxes by labeling some charges as “non-taxable fees,” putting airlines like Delta and American that don’t use the practice at a disadvantage.

Industry lobby group Airlines for America told CNN in a statement that its “members comply with all laws and regulations, including those on taxes and fees.”

Frontier defended unbundled fees as a way to make air travel more affordable.

“Frontier works every day to increase consumers’ access to affordable air travel and to ensure that it provides the best possible value to its customers. Our unbundled services model has democratized air travel, enabling millions of individuals, families, and small businesses who otherwise would not or could not afford to travel the opportunity to travel by air,” its statement said.

Airlines for America’s statement echoed that sentiment. “The subcommittee clearly lacks appreciation for the fact that air travel today is democratized, allowing Americans across all income levels to fly. Today, because of the revolution in air travel, nearly ninety percent of Americans have flown. That is because Americans have the power of choice to pay for the services they want and forgo those they don’t.”

Spirit Airlines said in a statement that it disagrees with much of the report and is “transparent about our products and pricing, our airport policies ensure Guests are treated fairly and equally, and we comply with all tax laws and regulations.”

“Junk fees” have been in the crosshairs of the Biden administration. In August, the Department of Transportation proposed rules that would eliminate seat-selection fees for families that want to sit together.

“I know that some airline CEOs have expressed hopes that the next administration will be less passenger-friendly and more corporate-friendly than this administration,” Transportation Secretary Pete Buttigieg said at a news conference last week. “The passenger protections that we have put in place deservedly enjoy broad public, bipartisan support.”

The Senate Permanent Subcommittee on Investigations says it will hold a hearing with officials from American, Delta, United, Frontier and Spirit next week.

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