Peter Greenberg Worldwide Radio Spotlight: Airline Fee Transparency Debate [ 18:55 ] Play Now | Play in Popup | Download

PG: The rules have been kicked into effect and there are a number of airline websites that have already conformed to it. One website that has an interesting disclaimer is Spirit Airlines. In fact, U.S. Senator Barbara Boxer wrote a letter to Spirit Airlines CEO Ben Baldanza, asking him to end “the airline’s deliberate attempt to deceive the flying public.”  Ben, you don’t see it that way, do you?

Image from SpiritAirlines.com

Ben Baldanza: No, we don’t. In fact, we believe that Barbara Boxer needs to get her facts straight. We believe the new rules are actually less disclosure, not more. Let me give you an example: before this regulation, if you went to spiritairlines.com and wanted to purchase a ticket, there is a calendar that shows you the prices and the prices two weeks before and after to see which is most accommodating for your stay and budget, we’ve made it easy to do that. As soon as you click on your date, the next thing you saw was your fare plus all your federal taxes and all the required taxes and some are waived for you immediately. Now, all we can put in the calendar is the total price. So you tell me which is better disclosure, seeing $75 for fare plus $25 in taxes equals $100, or just $100. The new rule makes us do that. That’s less disclosure, not more.

PG: If your fares change day to day, wouldn’t the total price fluctuate daily as well?

BB: Yes, but then again, the consumers should know what they’re paying the airlines for the service and what they’re paying the government. Our belief is that by hiding the taxes and combining it with the fare and making it look like one thing, it obscures what passengers are paying for the service and what they’re paying for taxes. That makes it very easy for the government to raise taxes and frankly it hides how much the consumers are paying for taxes. Consumers should know exactly how much they’re paying the government in taxes.

PG: Ben, I agree with you that the taxes on these airlines tickets sometimes exceed the fares.

BB: That’s often the case and the consumers should know that it’s taxes driving prices up, not the airline.

PG: The argument has been made by myself, Barbara Boxer and Kevin Mitchell that when an airlines advertises a fare that certainly gets my attention. However, you’ve run some fares that were as low as $9 without disclosing the additional fees and taxes that would be incurred, Advertising these fares is just to get our attention, right?

I saw a fare recently advertised to London for $282 with an asterisk, By the time you buy that ticket, it was not a $282 fare; it was a one way fare requiring a round-trip purchase and with the taxes, fees and surcharges, it came up to over $1,200.

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