Did you manage to outsmart the airlines before they outsmarted all of us on Saturday? Travelers had about 17 hours to book tickets without paying most government taxes, because of Congress’ failure to authorize funding for the Federal Aviation Administration (FAA) by midnight on Friday. Most carriers started pocketing that money at the very first opportunity they had.
I did book a ticket and saved about $50, but I must admit I didn’t expect the airlines to raise fares so quickly and deprive customers of any savings.
So what exactly happened? Shortly after midnight Eastern time (ET) on Friday, when the FAA lost its prerogative to collect taxes, airline reservation systems began dropping those taxes from ticket prices. I issued a $164 one-segment ticket on Friday — on Saturday, that same ticket was being offered for $150, with everything else the same, including the fare bases. I bought the ticket on Friday, because I wasn’t sure that taxes wouldn’t be charged the next day.
When I found out that they were indeed excluded, I decided to book another ticket — this one with seven segments, hence the $50 savings.
If you’ve read my book, “Decoding Air Travel,” you know that domestic fares are filed three times a day on weekdays, and once a day on weekends. That weekend feed at 5 p.m. ET was the first chance the airlines had to change fares — and they did, except for Alaska Airlines and Spirit Airlines. They seem to have refiled most fares to include the amounts they previously charged as taxes.
In other words, for 17 hours on Saturday, consumers were the beneficiaries of tax-free tickets. After that, the airlines hijacked the opportunity created by the FAA situation and have been making lots of money since. I’m actually rather impressed by the speed and scope by which they did it.
I should note that some smaller government taxes, such as those collected by the Transportation Security Administration (TSA), are still being charged.
Is it fair for the airlines to exploit a government fiasco for their financial benefit? At this point, it doesn’t appear that anyone can stop them.
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This should not be news, but it is: U.S. airlines have finally begun advertising some airfares properly, meaning they now show round-trip prices instead of the longtime marketing ploy of “each way based on a required round-trip purchase.” But those are just baby steps, as some taxes and fees are still being excluded.
When I wrote about false fare advertising in 2008, my copy editor at the Washington Times put this headline on my column: “Fare sales often lost in translation.” I compared the deliberately misleading airline practice to the mysterious “Twin Peaks” revelation “The owls are not what they seem.” I also wondered, If a round trip is required, why on earth is only half of the actual fare being advertised?
This month, United Airlines became the first major U.S. carrier to change its policy and advertise predominantly round-trip fares on its website — the only exceptions seem to be last-minute weekend specials. The airline is currently promoting five domestic and four international sales on its site, and they all include round-trip prices and fuel (YQ) surcharges — though some taxes and fees are excluded.
For example, a Business Class fare for a round trip from Los Angeles to Shanghai is shown as $3,513, while the total final price as of today is $3,572, if booked on nonstop flights. A round-trip Business Class fare from Washington to Rome is displayed as $2,411, and the final price is $2,460, if purchased today on nonstop flights. As you see, the differences are not that big.
All other carriers should follow suit. Continental and US Airways display some fares as round trips, but most of their advertising is still being done the old-fashioned way, as is American’s and Delta’s. Southwest, Alaska Airlines and Virgin America show one-way fares but don’t require round-trip purchases.
Although the Department of Transportation has looked into the issue and called on the industry not to deliberately mislead consumers, it has done nothing to stop the controversial practice. The European Union (EU), on the other hand, has been much more proactive on behalf of travelers. That’s why fares in Europe are advertised with the full ticket price.
Some of the European carriers that fly to the United States, such as Spain’s Iberia, are honoring the EU rules globally and displaying actual full prices on their U.S. websites as well. But others, such as British Airways, Air France and Lufthansa, while observing the rules on their home turf, have given in to the pressure from their U.S. competitors and adopted the “one-way based on a round-trip purchase” policy.
In January, all four above-mentioned European airlines offered the same fares from New York to London. The last three advertised $199, while Iberia showed $584, which is what the actual fare was, including all taxes and surcharges. Singapore Airlines, also having the guts to be honest with its customers, promoted a $586 fare from New York to Frankfurt that was truly the final price.
It’s high time the airline mentality of trying to trick customers changed once and for all.
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Continue reading about Proper airfare advertising comes to U.S.
Do you sometimes prefer making a connection or two instead of taking a nonstop flight, either to save money or rack up more frequent-flier miles? You might have to change your ways. Domestic U.S. transfers are now allowed much less frequently than before, and making connections on flights between an airline’s hubs is almost impossible.
No big deal, you might say. Wouldn’t any reasonable person choose a nonstop any time? Not necessarily. Different travelers have different priorities — some would rather save time, others money. But the best thing about the previous practice was that passengers had options. Now, that’s no longer the case.
Until June, you could make four transfers each way between Washington and Los Angeles on United Airlines — both cities are United hubs. Since then, the lowest fares have said this in the legal routing rules:
TRAVEL MUST BE NONSTOP
It’s not until fares of just under $700 round trip that the routing gets a bit more liberal — but it allows only one connection and only at a hub airport. Here is how this looks in the United tariff:
WAS-CHI/DEN/LAX/SFO-LAX
The slash indicates that you must choose among Chicago, Denver and San Francisco, but you can’t go through two of them — you would have been able to do so had there been a hyphen between them.
How does this affect you? As of this morning, the lowest published United fare between Washington and Los Angeles is $119 each way and books in L class — but it’s only valid on nonstop flights. What if none of the nonstops on the day you need to fly has available L seats? Then you will have to buy up to S booking class — the next lowest currently published — or whatever seat is available. There may be L availability on a connection through Denver, but it wouldn’t qualify for the L fare because it’s not nonstop. The bottom line is, the routing restriction will cost you at least $100 more.
United was actually the last of the major carriers to clamp down on routing rules, and many mileage runners — people who fly just to accumulate miles — had lots of fun for a long time. It still has one of the more liberal rules — except between hubs. American Airlines and US Airways follow the same policy. American requires a nonstop between Dallas and Miami, and US Airways between Philadelphia and Phoenix.
Delta Airlines is one of the strictest. For example, discounted fares between Atlanta, its main hub, and most major cities require a nonstop, even if that city is not a hub, such as San Diego and Las Vegas. A fair comparison would be the United routing between Washington and Las Vegas, which is much more generous:
WAS-SFO/LAX/DEN/CHI/WAS/EWR/HOU/CLE/PHL/CLT/PHX-LAS
This is actually a typical United routing. You can transfer only once at a hub, but it doesn’t necessarily have to be a United hub — Continental and US Airways hubs are also allowed, because United code-shares a huge number of their flights. Of course, current Continental hubs will become United hubs once their merger is complete.
Delta is so strict, in fact, that sometimes it requires a nonstop when neither of the two cities is a hub — for example, between Washington and Los Angeles. The curious part is that Delta doesn’t fly nonstop between those cities, but it code-shares the only daily Alaska Airlines flight from Washington National. So the only way to get a decent fare is to book that one flight at 9:15 a.m. If you can’t, you have to pony up.
To be fair, Delta allows both nonstops and “direct” flights, and when the other carriers say nonstop, they do mean nonstop. “Direct” flights are those fictitious flights I wrote about last month, which have nothing in common except for their number — most of them are operated on different planes and require changing gates and sometimes even terminals.
In addition, Delta is not always as draconian as in the Washington-Los Angeles case. Here is the routing between non-hubs Chicago and Los Angeles:
CHI-SLC/MSP/DTT/CVG/MEM/ATL/LAX/IND/DEN/SFO/LAS/PHX-LAX
The smaller the city, the more liberal the routing — although some bigger places seem to fall through the cracks, probably not for too long. Here is the United routing from Washington to Houston.
WAS-ATL/CLE/DTT/DAY/CMH/IND/RDU-CHI-HOU
WAS-ROC-BUF-CHI-HOU
WAS-ABE/HAR/ROA/SDF/RIC/CAK/CRW/ORF-CHI-HOU
WAS-NYC/EWR-ATL/CLE/DTT/DAY/CMH/IND/RDU-CHI-HOU
WAS-NYC/EWR-ROC-BUF-CHI-HOU
WAS-NYC/EWR-ABE/HAR/ROA/SDF/RIC/CAK/CRW/ORF-CHI-HOU
If you look closely, you will see that up to four transfers are permitted here — this many hyphens are very rare these days. I have the feeling this generosity will disappear once United and Continental start flying as one airline, for which both Washington and Houston will be hubs.
International routings are much more liberal and sometime can fill a page, but that’s a topic for another column.
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Is there an inherent conflict between the desires of loyal customers and a travel company’s interests? For years, executives have been acting as if there is, despite of what they might say in public. One of them, however, has actually shown that what’s good for travelers doesn’t have to be bad for business.
Graham Atkinson has been president of United Airlines’ frequent-flier program, Mileage Plus, for only 16 months, but while some questionable policies remain in place, he has made a big difference for the better. His approach is not simply to please the carrier’s best customers — it’s to listen to them carefully and find ways to benefit the company at the same time.
Mr. Atkinson, who is also United’s executive vice president and was previously chief customer officer, hasn’t sought much credit for his achievements…
Are airlines and hotel companies trying to benefit from charity donations to Haiti? When you donate miles or points, how do they decide into how many dollars your contribution converts? Should they be more generous than they are?
Every major U.S. carrier and hotel chain is offering the members of its loyalty program to redeem points in support of earthquake relief operations in Haiti, which was almost totally devastated earlier this month. For many Americans who may be short on cash but have thousands of points in various accounts, that is a rather attractive option.
Most airlines transfer the miles you redeem directly to the Red Cross or other organizations, which use them to book “award” tickets for their employees or disaster victims. Of course, those charities need either dedicated personnel or a travel agent to spend significant time working with the airlines to find the ever-so-elusive “award” availability…
