US Airlines Pull in Billions a Year in ‘Junk Fees’, Senate Report Says

That extra few inches of legroom you bought the time your flight lasted more than two hours was a good business while it lasted.

On Tuesday, the Senate released a report on its investigation into “junk fees” in the airline industry. According to US senators, five major airlines netted $12 billion from seat fees alone over the course of five years. A comforting thought as we head into one of the busiest travel days of the year.

Flying By the Seat of Their Pants

Tuesday’s Senate report follows the Biden Administration’s crackdown on junk fees in a range of sectors, including the airline industry. The regulatory scrutiny prompted some small adjustments from airlines — last year United made it free for parents to book seats next to their children so long as they’re under 12 years old — but the US government is not done.

The report was published by the Senate Permanent Subcommittee on Investigations, and looked at how United Airlines, financially troubled Spirit Airlines, Delta Air Lines, and American Airlines priced perks like taking baggage with you, having a little extra legroom, and sitting next to the people you’re traveling with:

• Some back-of-the-cigarette-pack math tells us that each airline was pulling in a (very rough) average of $480 million in seat fees per year, one of several types of junk fees that didn’t exist 20 years ago. 
• Earlier this year, the International Air Transport Association said that although the industry was expecting record revenue for 2024, profit margins remained thin — so eking out extra revenue from fliers could be a pretty significant booster on airlines’ financial reports.

Olé: It’s not clear whether the US government will continue to hold airlines’ feet to the fire over junk fees once the Trump administration comes in. But other countries have already started taking punitive action. Earlier this month, Spain slapped five budget airlines with a grand total of  €179 million ($188 million) in fines for what it terms “abusive practices,” which includes junk fees like charging for carry-on luggage. One of the airlines targeted, easyJet, announced this morning that it made £3.6 billion ($4.5 billion) in the full-year to October from fare add-ons, and its CEO hit out against Spain’s fine saying it’s a “highly unfair idea” that airlines shouldn’t be able to offer add-ons the way they do now. “It’s a good thing for customers and it keeps fares down,” he told CNBC.