Midday Report: Airlines Hike Up Added Fees, Just in Time for Summer

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It's time to plan your summer vacation, but check the fine print before you book a flight: That big, exciting trip across the country or overseas could carry surprising costs and added fees imposed by the airline.

Most of the major carriers have added an extra $50 if you change your reservation. It's now $200 at United (UAL), Delta (DAL), US Airways (LCC), and most recently, American (AAMRQ).

The change affects most domestic flights as well as travel to Canada and Mexico. The fee for changing some overseas flights is now $300.

stowing luggage on a plane
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The airlines say they are targeting business travelers, not people taking vacations. They say people taking business trips are much more likely to change their travel plans.

The industry maintains that charging business customers more allows airlines to offer cheaper seats to vacationers.

Southwest (LUV) remains a holdout. In fact, it might want to resurrect its old ad campaigns that mocked competitors for charging reservation change fees.

However, last week Southwest said people who fail to show up for their flight will forfeit their fare.

Southwest maintains its 'bags fly free' policy, but get this: Frontier Airlines (RJET) says it will soon charge as much as $100 for a carry-on.

The discount carrier's new fee is for bags that don't fit under the seat. So it's $100 if you get to the airport and find out your carry-on needs to go in the overhead bin, but $25 if you pay in advance.

And there is a way around this fee: Book directly on Frontier's website and carry-ons remain free. The airline apparently doesn't want to pay fees to Orbitz, Expedia and other travel sites.

But Spirit (SAVE) also found another way to nickel and dime its passengers. It plans to start charging $2 for coffee and soda.

Even if you're able to avoid the fees and add-ons, you're likely to find basic airfares are sharply higher than they were over the past few years –- in some cases 40 to 50 percent higher.

Partly this is because of rising demand. But industry consolidation –- i.e. mergers –- has a lot to do with it too.

In recent years, United has merged with Continental, Delta with Northwest, Southwest with Airtran, and most recently, US Airways with American. And that has reduced competition on certain well-traveled routes such as Chicago to Houston and Philadelphia to Miami.

So enjoy your summer vacation, but plan carefully.

-Produced by Drew Trachtenberg


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