By SEUNG MIN KIM and DAVID KOENIG, Associated Press
WASHINGTON (AP) — President Joe Biden on Monday announced a new initiative that would eventually allow consumers to see a more comprehensive price on airline tickets — including baggage and change fees — before buying, as the White House continues to seek ways to reduce costs for Americans amid persistently high inflation.
White House says DOT’s proposed rule will prevent airlines from hiding the ‘true cost’ of airfare, which would help consumers save money and encourage greater competition between airlines airlines to offer better fares. The requirement will apply not only to airlines directly, but also to third-party search sites such as Kayak and Expedia.
“You should know the total cost of your ticket as soon as you do comparison shopping,” Biden said Monday, citing fees charged by airlines for checking baggage or seating families together. The new rule, the president said, will help consumers “choose the ticket that’s actually the best deal for you.”
Airlines earned nearly $5.3 billion in baggage fees and nearly $700 million in cancellation and change fees last year, according to Transportation Department figures. Airlines charge a variety of other fees for extra legroom and other benefits that are not tracked by the government.
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A trade group for the largest US airlines said carriers already disclose the terms and total cost of a ticket. “This includes transparency around taxes and government fees on airline tickets, which make up more than 20% of many round-trip domestic tickets,” said Katherine Estep, spokeswoman for Airlines for America.
The proposed rule is intended to target a typical situation faced by consumers where the price of a ticket is listed on an airline or search website, but with information often listed elsewhere about the airline’s additional charges. airline, such as checking in or carrying baggage, securing a guaranteed seat next to your child, or changing or canceling a flight – fees that vary widely from airline to airline. another and could quickly add up to hundreds of dollars more in the price of a ticket after the initial purchase. According to the proposal, this information would be made available from the first display of the indicated airfare.
Fare information would be required for all commercial flights to, within and from the United States.
The proposal dates back to the Obama administration and was scrapped in 2017 by then-President Donald Trump after airlines complained it was unnecessary and would incur significant costs. It must now go through a 60-day comment period before final approval.
The proposed rule comes as tension mounts between the Biden administration and airlines, with each blaming the other for an increase in canceled and delayed flights this summer.
The Department of Transportation has also started releasing information to help consumers know what each airline offers when flights are canceled or delayed for reasons beyond the airline’s control. This has prompted several airlines to update their policies regarding finding a new flight and covering hotel and meal costs for stranded travellers.
Biden made the announcement Monday afternoon during a meeting of the White House Competition Council, created last year to help his administration find cost-cutting measures for consumers. This was the third meeting of the group, chaired by the director of the National Economic Council, Brian Deese.
“Capitalism without competition is not capitalism,” Biden said at the event, which was held in the State Dining Room of the White House. “It’s exploitation.”
At the meeting, Biden also pushed other federal agencies to take similar steps to cut costs, including increasing transparency about hidden fees that can inflate the true cost of goods and services.
One example is a Federal Communications Commission proposal that would require Internet service providers to better define fees and charges on what the administration calls a “broadband nutrition label.” And the Ministry of Agriculture will also unveil new actions on Monday to encourage competition in various agricultural markets.
The administration has taken similar action on bank and credit card fees, which the White House says saved consumers $3 billion a year compared to before the COVID-19 pandemic. 19.
Koenig reported from Dallas. Associated Press writer Hope Yen contributed to this report.
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