In a recent move that has sparked controversy in the airline industry, major airlines and an industry trade association have come together to challenge a new Department of Transportation rule requiring earlier disclosure of add-on fees during flight booking. The challengers, including trade group Airlines for America, Alaska, American, Delta, Hawaiian, JetBlue, and United airlines, argue that the DOT overstepped its legal authority with the rule, which they deem as “arbitrary, capricious,” and an “abuse of discretion.”
The petition for review was filed in the U.S. Fifth Circuit Court of Appeals, raising questions about the Biden administration’s introduction of the airline fee disclosure rule in September 2022. This rule mandates that airlines and online travel agencies disclose fees for seat selection, checked baggage, and other add-ons upfront alongside the airfare, rather than surprising customers with additional costs at checkout based on their selections.
President Joe Biden emphasized the importance of transparency in airfare pricing, stating, “You should know the full cost of your ticket right when you’re comparison shopping.” However, Airlines for America has expressed concerns that the rule will “confuse consumers” and “complicate the buying process.”
In a statement to CNBC, the group argued that airlines already provide complete fee disclosure to consumers before ticket purchase, and the DOT’s attempt to regulate private business operations in a competitive marketplace exceeds its authority. They believe that the rule is a “bad solution in search of a problem.”
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