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Airlines executives are set to face scrutiny before the Senate subcommittee as they defend their practice of imposing seat surcharges to boost revenue. The hearing, scheduled for Wednesday, comes in the wake of a report by the Senate Permanent Subcommittee on Investigations that accused major U.S. carriers such as American, Delta, United, Spirit, and Frontier of profiting off of what they termed as “junk” levies.
According to the report released on Nov. 26, these airlines collectively earned a staggering $12.4 billion in seating fees between the years 2018 and 2023. The investigation highlighted that passengers who opt for seats with enhanced legroom, seats in preferred locations towards the front of the plane, or window/aisle seats are required to pay an additional fee.
In response to the allegations, American Airlines’ chief strategy officer, Stephen Johnson, submitted a written statement to the inquiry, asserting that their seat selection products are entirely optional. He emphasized that their goal is to provide customers with the choice to pay for seats in desired locations if they so wish.
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The issue of “junk” fees imposed by airlines has been a point of contention for the Biden administration as well as several lawmakers who have vowed to crack down on the practice. The aviation sector has faced increased scrutiny over the past years for their add-on charges, including seat selection and checked luggage fees, which were previously included in the ticket price.
Airlines have defended their approach by stating that they are offering different tiers of economy service, with the option for passengers to choose additional services at an extra cost. They argue that providing premium seats and charging for seat selection and checked luggage are essential strategies to boost revenue in an increasingly competitive market.
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Stephen Johnson further explained that the indicated price for a seat in a higher fare class or with extra legroom reflects the additional value provided to customers. He also noted that customers are informed about potential fees for baggage and other services in advance to avoid any surprises.
The concept of fee-based seating was pioneered by Spirit and Frontier in the U.S., leading other carriers to introduce basic economy classes to compete. Spirit Airlines, in particular, faced financial challenges including bankruptcy filing in the wake of increased competition and engine issues.
Delta, United, Frontier, and Spirit executives are expected to testify at the upcoming Senate subcommittee hearing, scheduled for 10 a.m. ET. They will have the opportunity to defend their seat surcharge practices and address concerns raised by lawmakers regarding the impact of these fees on consumers.
