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Airline fees soar

Jennifer Collins May 31, 2011

Airline fees soar

Jennifer Collins May 31, 2011

Tess Vigeland: This next story comes with a warning: what I’m about to tell you could make your blood boil.

Airline fees are up $22 billion in just the past year.

Maybe that’s because you can hardly look at an airplane these days without paying extra. And as Marketplace’s Jennifer Collins tells us, more fees are on the way. But you might actually like what you’re paying for.

Jennifer Collins: That $22 billion is 60 percent more than airlines collected in 2009. Jay Sorensen is president of IdeaWorks, the consulting firm behind the analysis.

Jay Sorensen: I often get a lot of hate mail for this.

Before you flood his inbox, consider this.

Sorensen: If the airline industry was making buckets of money, I think you could criticize the airline industry for being greedy. That’s not the case.

Sorensen says jet fuel is going to cost U.S. airlines $15 billion more this year. And airline profits are relatively flat.

Harlan Platt: But you still hear people screaming at the airport.

Northeastern University finance professor Harlan Platt says that’s because the fees are for things that used to be free — and they’re often hidden in the fine print. But some airlines are trying to take out the sting by giving passengers a little perk with their punishment. When you check your bags with Delta, you get access to a service that lets you to track your luggage along the way.

Platt: That’s great for all parties concerned — the airlines getting some money and you have this extra information.

Alaska’s offering passengers extra miles or ticket discounts if their bags takes more than 20 minutes to get to the carousel.

But however they’re packaged, analysts say airline fees are here to stay.

I’m Jennifer Collins for Marketplace.

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