Airlines make 20% more money in fees

Airlines globally raked in $27bn in fees in 2012

Airlines collected in excess of $27 billion in fees and other non-fare revenue in 2012, a new report has found, representing a 20% leap from 2011.

Ancillary fees are now “a crucial component of airline income,” the report by the marketing agency IdeaWorks says. The study was sponsored by CarTrawler, an Irish company that provides online car rental distribution systems and which recently took control of the Holiday Autos brand.

“Every year, key numbers are getting larger,” states the report. “The most aggressive airlines easily generate more than 20% of their revenue from a la carte fees. Once largely limited to low fare airlines, ancillary revenue has now become a financial necessity for airlines all over the globe.”

Airlines in the USA dominate the list for total amounts of non-fare revenues collected, with United Airlines top, followed by Delta, American and Southwest. The “ultra-low cost carrier” Spirit Airlines took the most in fees as a percentage of total income (38.5%).

The report’s findings have provoked much criticism among some in the travel business. “This is $27 billion of deception,” Charlie Leocha, director of the Consumer Travel Alliance, commented. He stressed that so many extra charges make the process of flying much more difficult for passengers.

NBC

[photo: Swedavia/Daniel Asplund]


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