Spirit Airlines Charges ‘Unintended’ Fee

The row between the US Department of Transportation and budget carrier Spirit Airlines has worsened this week after the airline added a new $2 fee to fares. The charge is being called a Department of Transportation Unintended Consequences (DOTUC) fee, which it says is aimed at covering the costs related to the new consumer regulations that were made effective last week – specifically for holding tickets 24 hours after booking without penalty.

Department of Transportation Secretary Ray LaHood says that this is another example of the disrespect endured by passengers from too many carriers. Instead of coming up with unnecessary charges for customers, airlines should focus on offering transparent and fair services, which is what their common sense rules are designed to do.

New consumer protection regulations were ordered by the Department of Transportation to take effect on January 26. Spirit Airlines has been one of the most vocal objectors to the new rules, along with Allegiant Air and Southwest Airlines – all of which are prominent carriers at McCarran International Airport, serving Las Vegas. The new regulations order carriers to include all taxes and fees in advertisements or any display of airfare costs. Fees that may not apply to all passengers don’t have to be disclosed – like booking and baggage charges. Airlines are also ordered to hold fares for passengers for 24 hours at booking and allow them to change or cancel the tickets within that period without penalty.

Low-cost carriers like Spirit, Allegiant and Southwest are more sensitive to the new regulations, as they traditionally have offered lower prices. Now, however, the prices of their fares with taxes and fees included will be like sticker shock to potential flyers. Spirit and Allegiant, which both saw an increase in passenger numbers last year at McCarran, use business models that offer big discounts but several charges for bags, selecting a seat and booking over the phone or online. Fares for Southwest, which is McCarran’s busiest airline, will appear higher, but it doesn’t have bag fees.

Spirit Airlines president and chief executive Ben Baldanza says that people love not having to commit to reservations, but this regulation imposes costs on consumers. Everyone would like to eat as much as they want and not get fat. Regulators like to try to sell the idea of the rule, but have ignored the cost to consumers. People can’t eat all they want without consequences, he added. The carrier also believes that including taxes and fees in the ticket price will keep consumers from seeing how much each costs separately.

California Senator Barbara Boxer, who has slammed Spirit for emailing customers about the government urging carriers to hide federal taxes, has sent Baldanza a letter recently. She told him that she has been shocked by the failure of Spirit to tell the truth in the customer email and warnings posted on its website. Telling consumers that the government is requiring airlines to hide taxes in fares couldn’t be further from the truth.

The letter explained that the rule says carriers have to tell customers the full cost of a ticket, prohibiting them from advertising fares that exclude taxes, fees and other charges. This was done due to the major impact of such presentations to confuse and deceive travellers. Despite the claim from Spirit that it has to hide this information, the regulation allows airlines to advise the public about government taxes and fees in their fare solicitations.

Boxer added that consumers today are faced with many options when planning to fly, and having the ability to compare the full price before buying airfare is necessary and fair. Baldanza’s earlier statement that breaking out costs so consumers know what they are buying is just what this new regulation will help do, she added.