This week, United Airlines jacked up fees on passengers who need to adjust travel plans. For flights within the U.S., customers must fork over at least $200 (up from $150) for changing tickets.
The carrier raised the change fee on certain international flights as well, from $250 to $300 for many routes to South America. In reality, passengers can wind up paying much more to change a flight itinerary. That’s because on top of the fee, a customer must pay the fare difference of the original flight price compared to the going rate of the new itinerary being booked.
Say you purchased a round trip on United from Chicago to Phoenix for $300, and then needed to change the travel dates to a week later. At the time you made the change, a flight for the new dates was selling for $500. To switch to that flight, United would charge a $200 change fee, plus another $200 for the fare difference ($500 minus $300). So the change would cost $400 overall—or more than the original ticket cost! And that’s on top of the $300 spent on the initial booking.
So-called legacy airlines have assessed change fees in this manner for years, but the fee itself has risen swiftly. The standard was $50, then $75, then $100. In 2008, United raised its change fee from $100 to $150, curiously citing “high fuel costs” as the reason. (It’s not like gas gets any more expensive when passengers change flights.)
The Wall Street Journal noted that Delta and United collected $1.1 billion in reservation change fees just in the first nine months of 2012. And why would United need to hike fees further? “We carefully manage our seat inventory and incur costs when a traveler elects not to fly in a reserved seat,” a United spokesperson said in a released statement. “We adjusted this fee to better compensate us for those costs.”
Consumer advocates view the situation differently:
“I find it odd that in today’s technology-based economy, that the airlines still contend that they need to impose change-of-flight fees on any customer,” says Brandon Macsata, executive director of the Association for Airline Passenger Rights. “And certainly charging $100 or more, as most airlines do, is absolutely ridiculous.”
Yes, airlines would incur costs if a passenger bought a seat and changed flights, and then the original seat wasn’t filled by another traveler. But that almost never happens nowadays. One airline expert weighed in at CNBC:
“With 80 percent or more of most US airlines’ seats filled, airlines are clearly selling almost every seat they have, so I’m not buying United’s excuses that they’re inconvenienced when people don’t show up for a flight,” said Henry Harteveldt, airline and travel industry analyst with Hudson Crossing.
“Airlines also routinely overbook flights, selling more reservations than there are seats on the plane, knowing some people won’t show up,” he said. “So the airlines have already taken business steps to protect their bottom line.”
Harteveldt and other airline experts think that other airlines, including American, are likely to follow United’s lead and tack on another $50 to their change fees. What’s crazy is that the $150 change fee is already more than what Spirit Airlines, the nation’s undisputed champ of fees, charges passengers to change tickets, starting at $115. (JetBlue charges $100, meanwhile, and Southwest has no change fee; passengers just pay the fare difference.)
Spirit probably understands that if it raised change fees too high, no customers would bother changing their tickets. After all, if your original ticket cost, say, $150, there is no sense in changing that flight for $200 plus the fare difference. You’d be better off forgetting about the original purchase and starting from scratch in pursuit of a new itinerary—and your search would likely include the possibility of flying with another carrier. Airlines wouldn’t like that. Not only could business could be steered to the competition, but travelers have no incentive to give a head’s up to an airline that they’re not going to be using their original seats. That hurts the airline’s chances of reselling the seat.
Nearly all airline tickets are nonrefundable, as they have been for decades. As change fees creep higher, many cheap flights are basically becoming nonchangeable as well.