Honest pricing

[chockalicious]

Even if the airlines 'make' a little money off the handling fee after paying credit card fees on the full AIF amount and all of the workforce and other handling costs to pass the airports a cheque every month, the real cost is the overall loss of business for Canadian airlines. Like I said before, airline travel is elastic and the high AIF's at Canadian airports are just another thing that pushes travellers to the US airports or alternative forms of travel. $25 each way for a family of 4 becomes $200 just for AIF's, easy to see how it can deter people from flying.

I'm all for all in pricing when it comes to things like fuel surcharges, but when the airlines have to collect a fee on behalf of someone else I think it should be broken out.

I don't disagree and AIF is probably a net loss for the industry in terms of driving traffic away, just stating that airlines make significant revenue handling it for airports.

[spreadsheet]

I don't disagree and AIF is probably a net loss for the industry in terms of driving traffic away, just stating that airlines make significant revenue handling it for airports.

I think you may have seen or been told the revenue side without netting off the expenses the airlines incur processing it...

[chockalicious]

I think you may have seen or been told the revenue side without netting off the expenses the airlines incur processing it...

Nope not at all. I have worked with both numbers.

[Thebean]

Southwest Airlines Co. and some other carriers are fighting the U.S. Department of Transportation over a new airfare advertising rule scheduled to take effect next month, saying the change violates their free speech rights.

For decades, airline ticket prices have been advertised separately from government-mandated taxes and fees. That will change on Jan. 24, when a new rule will require ads for airfares to include such charges. Taxes and fees account for about 20 percent of the cost of an average airfare.

Dallas-based Southwest, Spirit Airlines and Allegiant are asking the U.S. Court of Appeals for the District of Columbia to block the proposed rule. They say it violates their First Amendment right to free speech by prohibiting them from letting consumers know the "significant tax burden on air travel in a clear and conspicuous matter," according to court documents.

The Transportation Department said in court documents that "there is sometimes a lack of clear and adequate disclosure" of airline ancillary charges so consumers "are not always able to determine the full price of their travel ... prior to purchase."

Department officials did not return a phone call on Tuesday.

Southwest spokesman Chris Mainz disagreed in an email, saying, "We have received no complaints on how fares are advertised today." He called the rule "consumer unfriendly," saying it increases confusion for consumers.

"Our main objection is that there is no justification for treating air travel differently from just about everything else that consumers purchase, i.e., they pay for the price of goods and services and then pay tax," Mainz said. "And that's how everything is advertised, as the price of the item separately from the tax on that price. Forcing airlines to include taxes will also make air travel look more expensive when in reality it's not."

Southwest in its court filing used canned vegetables at a grocery store and a six-pack of beer at a liquor store as examples of U.S. goods and services that commonly exclude taxes in advertised prices.

Southwest said in court documents that it will be "impossible to advertise a single accurate price to cover all possible itineraries" and that it will have to quote a range of fares. The carrier also said it will be "very difficult" to advertise prices in specific city-pair markets due to variations in routings, such as a nonstop flight vs. stopping in El Paso on the way to Las Vegas.

Mainz said that the change will be "very costly to implement" and that Southwest also had to "forgo other projects to focus our resources to meet the DOT's deadline."

Dave Ridley, Southwest's senior vice president of marketing and revenue management, said in court documents that the airline would have to pay $6 million in technology costs to redesign the Southwest and AirTran Airways websites. (Southwest acquired rival AirTran in May.)

Southwest also would lose $18 million to $24 million in expected revenue due to at least three months of delays to implement certain projects as technology resources are diverted to meet the requirements, Ridley said.

The new rule also will require significant changes to Southwest's Rapid Rewards program, reservation and ticket distribution systems and marketing plans, according to court documents.

[DEFCON]

Imagine; a 'corporation' claiming the 'Right' of Free Speech?