New Obama Administration Rules Require Airlines To Disclose Full Ticket Prices Upfront

Starting in late January, the Obama administration will force airlines to be more transparent about the full cost of tickets they often disguise in ads touting cheap fares. Low-price airlines Southwest, Spirit, and Allegiant are going to court to stop the rules, arguing that they violate corporate free speech rights.

But consumer advocates say the changes are a positive development for travelers who have beenswindled by airlines for too long:

Advertisements that make airfares seem enticingly low will soon lose that asterisk pointing to a dense paragraph of additional taxes and fees that make a cheap ticket much more costly.

Beginning Jan. 24, the Transportation Department will enforce a rule requiring that any advertised price for air travel include all government taxes and fees. For the last 25 years, the department has allowed airlines and travel agencies to list government-imposed fees separately, resulting in a paragraph of fine print disclaimers about charges that can add 20 percent or more to a ticket’s price.

But with airlines now promoting fares on Web ads, Facebook and Twitter, and adopting a menu of fees for services that used to be part of the ticket price, the government decided it was time for a change so travelers have a clearer sense of the total price they must pay.

Kate Hanni of FlyersRights.org describes an all-too-common scenario: “People would get up against the point where they were about to make a purchase, and suddenly the cost of their ticket went up because of these taxes and charges.”

“Requiring all mandatory charges to be included in a single advertised price will help consumers compare airfares and make it easier for them to determine the full cost of their trip,” said Bill Mosley, a Transportation department spokesman. The advertising rule is one of a dozen passenger protections the department adopted last spring.

But airlines like Spirit that have built their profits on advertising $9 fares, then charging much more, are determined to resist the new rules. They are also objecting to changes that “allow passengers to cancel a ticket purchase without penalty within 24 hours of booking; include information about baggage fees on e-ticket confirmations; and notify passengers more promptly about flight cancellations and delays.”

The government’s move was prompted by a dramatic increase in deceptive advertising. This year, the Transportation Department issued 21 penalties totaling $1 million in fines for fare advertising violations, compared to 14 penalties and $379,000 in fines in 2001. Spirit, for instance, advertised a $9 fare on Twitter, then forced customers to click links to two more Web pages to find out the full price.