- The Proliferation of Airlines’ Add-On Fees
- Consumer Concerns Over Transparency and Value for Money
- The Financial Significance of Ancillary Fees to Airlines’ Revenues
Jonathan Massey, a frequent traveler, has been “stung” multiple times by airlines’ add-on fees.
“You will inevitably be caught off guard by something you overlooked,” he says.
Undoubtedly, purchasing a flight has become more complicated.
Currently, airlines offer a plethora of paid extras during the booking process, including expedited boarding, checked cabin baggage, and seat selection.
If you do not comply with a carrier’s terms and conditions, you may incur unexpected fees at the airport. Take, for example, the elderly couple who went viral last week after Ryanair charged them £110 to check in and print their tickets at the airport because they had downloaded their return tickets by accident.
Jonathan, 57, from Berkshire, who travels frequently for business, has no problem with additional charges as long as they are transparent.
However, he believes that they are frequently not communicated explicitly or consistently applied.
For example, he was once charged for cabin baggage on a flight from Morocco to the United States, but there were no issues with the same luggage on the outbound flight.
Increasing revenues
A recent survey conducted by the consumer group Which? asked respondents about their flight experiences over the past two years. It located:
- 26% of those who paid for seat selection felt it was not worth the cost.
- 29% of passengers did not believe speedy/priority admission was worth the additional cost.
- 36% of people did not believe that the cost of food and beverages on board was justified.
- Last year, so-called “ancillary” services generated roughly $103 billion (£81 billion) worldwide, up from $40 billion in 2013.
The airlines claim that by “unbundling” amenities such as food and beverages and cabin baggage from the price of the ticket, passengers have more options and pay less overall.
The aviation industry, according to Airlines UK, is extremely competitive, and carriers “work hard” to keep passenger fares “as low as possible” in the United Kingdom, the third largest aviation market in the world.
Critics argue that the increasing number of “extras” can make the booking process perplexing.
As formerly free benefits are eliminated, the cost of some privileges is also skyrocketing. Since 2018, three of the most popular airlines in the United Kingdom – Ryanair, EasyJet, and Wizz Air – have reduced their free cabin baggage allowance by half, according to an investigation by the BBC’s Rip off Britain.
“Many passengers will find it unfair that they must pay much more than the headline fare, with many airlines charging exorbitant fees just for the privilege of sitting with small children or bringing a cabin bag onboard,” travel editor Rory Boland tells.
“The fees for these ‘added extras’ can add up quickly, so it’s important to look beyond the headline fare when determining which option offers the best value.”
“Increasingly imaginative”
Ancillary fees were introduced in the 1990s with the emergence of low-cost airlines like Ryanair and EasyJet, but they have since extended to larger airlines, according to John Grant, a senior analyst at aviation data company OAG.
“Twenty years ago, you would have paid for a ticket and a checked bag even if you didn’t want one,” he told.
However, he claims that extra fees have become a larger part of airlines’ business models over the past seven years and that airlines are becoming “increasingly creative” with their pricing strategies.
“Fees are increasing because the cost of air operations is going up,” he says.
EasyJet has stated that it will “always be competitive and provide good value.”
“Customers can choose to only pay for what they want and avoid paying for services they don’t need,” the report continued.
In 2022, additional fees will account for over one-third of sales, or just under £1.6 billion, showing the airline’s importance.
The company’s revenue per passenger increased by 59% between 2019 and 2018, from £14.32 to £22.73.
Ryanair earned approximately €22.80 (£19.40) per passenger in its most recent fiscal year, up from €17 per passenger in 2019. Similarly, over a third of its total revenue, or €3.8bn, now comes from ancillary services.
Travel expert Simon Calder doesn’t mind most airline add-ons because customers may opt out.
According to him, airlines such as Ryanair have also significantly reduced the cost of air travel for the general public.
But Calder adds, “Once you incur exorbitant fees to wheel your suitcase onto an airplane. It becomes absurd and has no correlation to the airline’s cost.” It’s all about the money.”
Additionally, he objects to having to pay extra to sit together, as is the case with Ryanair and Wizz Air.
Michael O’Leary, CEO of Ryanair, told passengers in 2017 to “stop complaining” about the policy. However, Calder views this as an uncomplicated money-making endeavor.
“In general, EasyJet and British Airways will seat you together if you do not select a seat,” he explains.
Assigned seating and priority boarding are optional; travellers can “mix and match ancillary products to suit their needs.”
A WizzAir representative said users can “unbundle” its “ultra-low-cost” items to pay for what they need.
“Optional add-ons are not required to fly, and we believe customers should have the choice and flexibility to select the best products for them,” the spokesperson explained.
