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The runaway costs of a la carte fares by Roger Collis

May 5, 2009

What incenses travelers more than anything these days is that the price of an air ticket they have purchased online can just about double when it comes to the final amount charged. A friend flew from Frankfurt to London with Lufthansa: The fare was 11 euros – plus 99 euros ‘taxes.’!) Just as we have become reconciled to a raft of taxes - as wide-ranging as the U.S. Animal & Plant Health Inspection Tax, the Sydney Noise Tax and the Canadian Airport Improvement Tax – here come the airlines with extra charges for all manner of things, from checked baggage, onboard meals and beverages, even soft drinks and water, to changing tickets, and (caveat emptor) hanging on for hours on the help-line.
           Airlines have been moving towards à la carte, pay-for-all-the-extras pricing for some time, adding charges for everything from meals to window seats – following the budget carriers’ lead, believing that this is the magic bullet for restoring profitability.
           Travelers now find that that the final cost of a flight is three times more than the than the starting-off price of the ticket.
 According to a survey by Airline Information, a consulting firm in Miami, 48 percent of  respondents confirmed that their airline was charging for a la carte items, such as onboard food and drink, seat assignments and baggage; while 62 per cent felt that their airline ‘did not adequately or transparently relay a la carte options and fees to travelers.’ And 68 percent envisage airlines overall increasing their a la carte fees over the next 12 months.     
 And yet a la carte can work well for travelers (provided it is transparent and offers them  choice).  After all, why pay for meals and drinks that you do not need (subsidizing that fellow passenger who eats and drinks everything in sight), or for checking bags when you only have a light carry-on?
            U.S. carriers (except Southwest Airlines) now typically charge $15 or $25 for the first checked bag; now charge between $25 and $50 for the second bag, and $100 each for the third, fourth and fifth bags, and have reduced the maximum weight from 70 pounds to 50 pounds, or from 32 kilograms to 23 kilograms, in economy on international and domestic routes.
Delta Airlines has announced the imposition of a $50 fee for a second checked bag on international flights; and Alaska Airlines announced a $15 charge for the first checked bag.
            At Air Canada's Web site, you can choose from four basic fare levels. The top tickets, Latitude and Executive Class, are all refundable and come with priority check-in, food, drinks and all the frills. The cheapest fare, Tango, requires extra fees for meals, advance seat selection, flight changes and access to the airport access; Tango passengers can save $3 if they forgo frequent flier miles, or do not check a bag.
            Air Canada's à la carte pricing model is being followed by other carriers. American Airlines, for example, has announced it will fully implement à la carte pricing this year, offering a few basic fares, giving travelers the option of paying for additional services.
           But there’s a lot of anger out there.
           Stan Juster from Karmiel, Israel, writes: “Any day now, I expect airlines to charge for turning on the overhead air spigot. It’s an absurdity for airlines to think the public will accept extra fees for checked luggage, seat selection, food and water, pillows and blankets etc. - all under the guise of compensating for higher fuel costs. It’s a boondoggle; just another way to increase their profit margin, particularly in light of the recent decrease in the cost of fuel.”
            Martin Bleasdale from Les Baux de Provence, France, agrees: “They may as well include the rest of the fuel, airport landing fees, amortized price of the plane, meals, drinks, cabin lighting, crew salaries …,” he writes. “That way they could charge full price for a free ticket.”
            Indeed.
Ryanair, which has deepened the no-frills experience by making passengers walk from terminals to the aircraft in the open, for not providing umbrellas when it is raining or snowing, or even free wheelchairs for disabled passengers, now plans to  remove all check-in desks from airports by October 1, forcing passengers to check in online. And don’t expect quarter if you are overweight: Ryanair allows only 15 kilos of checked baggage per passenger (compared with EasyJet’s 20 kilos), has increased its excess baggage charge to seven euros per kilo, and will charge £5 per passenger per flight for bookings. The carrier says it expects to introduce charges of £50 per bag this year, with a view to getting rid of hold baggage altogether.
            Now, here comes the Dublin-based carrier’s abrasive chief executive Michael O’Leary with an incredulous  proposal to make passengers, who have just paid £2.50 for a cup of coffee, £1 a time to use the lavatories on board. Ryanair will introduce the charge ‘as soon as technically possible,’ raising ‘about £15 million in a year for using the facility.’
‘If you look at it sensibly, it would reduce an awful lot of the unnecessary visits to the loo that pisses so many passengers off onboard a plane,’ Leary says. ‘If we think 20 percent of our passengers in a year would use the facility, if they paid a pound per passenger, it would raise about 15 million quid and would help us to pass on £15 million of fare savings to the traveling public.’
Passenger groups have reacted with incredulity to the idea, but O’Leary says that the plan could lead to lower fares.
Rochelle Turner, head of research at ‘Which? Holiday’ in London, says, ‘It seems Ryanair is prepared to plumb any depth to make a fast buck, and, once again, is putting profit before the comfort of its customers. Charging people to go the lavatory might result in fewer people buying overpriced drinks on board, though – that would serve Ryanair right.’
O’Reilly rejects the criticism, describing the plan as another ‘cutting-edge’ initiative, like charging for drinks.
Probably, O’Leary is simply flying another kite; he must, of course, maintain his bad name as the man we all love to hate. 
This is open season for satirists and soothsayers – who are always liable these days of being overtaken by reality. 
             There’s nothing new under the sun. Some thirty years ago, the Canadian carrier Wardair (long since subsumed by Air Canada) offered quality at reasonable prices with a single standard of cuisine and service throughout the plane and a ‘Big Seat’ option.  No matter how much you paid for your ticket, you could trade up to a Big Seat in the front of the cabin for about 50 Canadian dollars.
United Airlines offers some ‘increased legroom’ seats in the economy cabin on domestic services for $39 a leg (or $156 for a round-trip with one stop).    
  The notion of having first class, business class, premium economy and economy cabins might eventually disappear in favor of total  a la carte travel, whereby travelers would pay a basic fare, depending on their choice of seat, for transportation, and pay extra for meals, drinks, in-flight perks, entertainment options, baggage, lounges, fast-track security, curb-side check-in, and door-to-door limo transfers.
  A classless society? Now there’s a template for the future!
 

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