Airline executives fret over rising fees that are leaving passengers ‘walking around with piggy banks’

The nation’s top airline executives were denounced on Capitol Hill Wednesday for spiking checked baggage fees, assigned seating and other perks to extort more money from passengers.

Democratic Sen. Richard Blumenthal, chairman of the Senate investigations subcommittee, brought in top executives from American Airlines, United Airlines, Delta Air Lines, Spirit Airlines and Frontier and criticized the airlines for charging exploitative fees.

“Today, airlines view their customers as little more than walking piggy banks to be shaken off for every possible penny,” Blumenthal said.

He argued that the federal government should investigate and potentially fine airlines for unnecessary “junk fees.”

Blumenthal’s threat came a day after Frontier CEO Barry Biffle drew scorn after defending one of the airline’s most controversial practices – paying gate agents $10 to catch travelers trying to carry an oversized carry-on bag to take with you.

“They are shoplifters. These are people who steal,” Biffle said Tuesday. “It’s not fair for everyone who follows the rules.”

On Wednesday, Republican Senator Josh Hawley accused airlines of charging passengers different fees for luggage on the exact same flight.

“It’s Russian roulette,” Hawley said. “Nobody likes flying with your airlines. It’s a disaster. …It’s terrible. It’s absolutely terrible.”

The subcommittee took aim at so-called discriminatory seat fees – a practice that generated $12.4 billion in revenue for the five airlines between 2018 and 2023, according to a report released last week by Blumenthal.

“At some point we are all prisoners on your planes. They just say, ‘Would you like to pick a seat?'” “We’ll just charge you whatever amount more,” said Democratic Sen. Maggie Hassan of New Hampshire. “It would be good if you could disclose what you are doing and why.”

The subcommittee’s year-long investigative report found that companies are increasingly using algorithms to set higher prices for customers who they believe will pay more.

Some of the senators were skeptical that airline executives couldn’t explain how they set the different fees and advocated for improved price transparency to make it easier for travelers to budget their trips.

However, airline executives said their fees are transparent enough and the different tickets offer something in every price segment.

Delta CEO Peter Carter said the airline offers “options and value for every customer.”

American Airlines Vice Chairman Stephen Johnson also defended the pricing practices, saying airlines need to be able to “target the most price-conscious customers.”

Andrew Nocella, United’s executive vice president, said the company is already preparing to lose hundreds of millions of dollars in revenue after eliminating its family seating fees in 2023 and plans to reduce its Wi-Fi fees next year to abolish.

“Our customers who value affordability have the opportunity to choose a more affordable product,” Nocella said. “But we also have customers who want more services, and they retain the option to choose the services they value, such as a seat with more legroom or checked luggage, for an additional fee.”

Subcommittee members also sharply criticized airline executives for paying employees extra to charge boarding passengers with last-minute fees in an attempt to avoid carry-on baggage fees.

Low-cost airlines Frontier and Spirit paid gate agents and other employees $26 million between 2022 and 2023 to track down passengers with oversized items, according to the subcommittee report.

“If people want to know why flying is such a terrible experience, then today is news to them,” Hawley told airline executives. “Your airlines are paying your employees millions of dollars to harass people who have already paid!”

Matthew Klein, Spirit’s executive vice president, said the budget airline stopped paying its employees to cover these final fees as of Sept. 30.

The airline industry is suing to block a Transportation Department regulation that would require more transparency on baggage and cancellation fees. A U.S. appeals court blocked the rule over the summer pending a full review.