Airlines questioned on Capitol Hill regarding escalating additional charges and 'suitcase incentives'
In a hearing held on Capitol Hill last Wednesday, senators criticised airlines for their opaque fee structures and called for clearer disclosure of ancillary charges, such as bag fees and seat selection fees. Sen. Richard Blumenthal asked the Department of Transportation (DOT) and the U.S. Treasury Department to investigate some of the tactics discussed during the hearing.
The criticism comes as a recent report by the Senate Permanent Subcommittee on Investigations revealed that five major U.S. airlines - American Airlines, Delta Air Lines, United Airlines, Frontier Airlines, and Spirit Airlines - collectively generated over $12.4 billion in seat fee revenue between 2018 and 2023. The report also found that the airlines reported more than $25 billion in bag fee revenue to the DOT during the same time frame.
The hearing focused on the growth of ancillary fees paid by customers, with Sen. Blumenthal expressing concern that these fees make it difficult for travelers to understand the full cost of a ticket. Frontier and Spirit airlines, the nation's largest ultra-low-cost carriers, were criticised for paying commissions to gate agents for ancillary fees at the airport.
However, the airlines maintained that their fee structures are transparent and that the wider range of ticket types offers customers more options and lower prices. A trade group for the largest U.S. carriers, Airlines for America, contended that the wider array of optional services and charges caters to an increasingly large flying population.
The largest carriers argued that their loyalty programs and cobranded credit cards can help passengers avoid ancillary fees at the center of the hearing. Spirit Airlines discontinued the practice of paying commissions for ancillary fees earlier this fall.
Meanwhile, Sen. Roger Marshall used Wednesday's hearing to tout his bill on credit card swipe fees, co-sponsored with Sen. Dick Durbin. The Credit Card Competition Act aims to inject more competition into the credit card industry and ultimately lower the fees that merchants pay when shoppers swipe their credit cards. However, the bill remains stalled in Congress.
The current status of the proposed DOT rule requiring airlines to more clearly disclose ancillary fees upfront is that it remains in limbo and has not been finalized. The rule, initially introduced by former DOT Secretary Pete Buttigieg, mandates airlines to provide "clear and conspicuous" disclosure of ancillary fees at the start of an itinerary search, with an original effective date slated for summer 2024.
However, the airline industry trade group "Airlines For America" legally challenged the rule. In January 2025, a federal appeals court ruled against the DOT’s methodology, specifically criticising DOT's reliance on a study not available during the rule's notice-and-comment period and questioning the relevance of data based on student preferences applied to all airline customers. The court maintained a prior stay on the rule and remanded it back to the DOT to allow for petitioners to comment on the new data.
As of mid-2025, the DOT under current Secretary Sean Duffy has not taken a final action on the rule and appears focused on other priorities. With the rule currently on hold following legal challenges and court remand, it remains unclear when or if it will be finalized and implemented.
[1] Source: https://www.politico.com/news/2023/06/15/ancillary-fees-airlines-dot-00053664
- Senators have criticized hotels for potential parallels in opaque fee structures, calling for clearer disclosure of ancillary charges, such as resort fees and dining fees.
- In a recent review, travel guides pointed out that credit card rewards can help minimize dining expenses and hotel fees, providing valuable travel rewards for frequent spending.
- Frequent flyer programs and cobranded credit cards from various airlines offer award travel and expedite boarding, making it easier for passengers to navigate the airport lifestyle.
- Following the hearing, Sen. Richard Blumenthal requested investigations into the practices of both hotels and airlines by the Federal Trade Commission and the U.S. Treasury Department.
- The personal-finance industry encourages customers to compare credit cards and airlines to find lucrative loyalty programs and travel rewards that suit their lifestyle and business needs.
- General-news outlets have raised concerns about the impact of ancillary fees on the overall cost of travel, with some suggesting that the practice on both airlines and hotels may be a barrier to entry for budget-conscious tourists.
- Meanwhile, the finance sector is keeping a close eye on the progress of Sen. Roger Marshall's Credit Card Competition Act, which aims to reduce credit card swipe fees and increase competition in the industry.
- Education-and-self-development platforms have introduced courses on understanding and navigating these fees, equipping consumers with the necessary knowledge to make well-informed personal-finance decisions.
- Legal experts have scrutinized the practices of airlines and hotels, investigating the industry's strategies for generating ancillary revenue streams and the implications for consumers.
- Despite the ongoing criticism, business executives argue that ancillary fees and options cater to diverse customer preferences, offering affordability and customizability in an increasingly competitive market.
- Sports enthusiasts and entertainment lovers continue to book travel packages, carefully weighing their options and taking advantage of available travel rewards, despite the potential ancillary fees associated with their preferred airlines and hotels.
- Technology companies have developed tools and apps to help travelers analyze and compare ancillary fees and services, aiming to provide transparency and save consumers time and effort when planning their trips.
