The real sticker-price of air travel

Take my case. Just after Christmas 2007, Flight Centre quoted me $1,950 plus tax for each of two mini around the world airfares with Lufthansa (and partner airlines). The quote said taxes are $1,215. Who knows if Flight Centre’s total of $1,215 is legitimate? Maybe the real total is really less than $1,215 but how do I know? There is no requirement in Australia for Flight Centre to break up and list these charges. I found it a bit rich that taxes and surcharges amounted to 62 per cent of the airfare.

In my case, I was so cranky with Flight Centre’s dismissive replies to my queries, that I approached Lufthansa. The efficient and thorough Germans advised me in writing, that the taxes and surcharges total $1,150, or $130 less (on the two tickets I bought) than what Flight Centre fleeced me. When I emailed Flight Centre a scan of the letter from Lufthansa’s General Manager, Australia, Flight Centre replied that Lufthansa is plainly wrong. And the implication was that Flight Centre would be keeping the $130.

Airline passengers are increasingly demanding that price information they receive in advertisements reflect the total price of the air services they are purchasing.

Assiduous consumer groups have begun to advocate for greater transparency in airline marketing practices. The lack of transparency is a constant source of consumer frustration, so it’s eye popping to witness truth in advertising raise its head in the marketplace.

On Saturday, January 19, Singapore Airlines rolled out advertisements in The Sydney Morning Herald's "Good Weekend" magazine that showed ticket prices inclusive of taxes and surcharges. Quite correctly the Singapore Girl advises that travel agents’ fees (if any) are additional. Singapore Airlines should be commended for advertising true fares and for its rejection of bait advertising employed by other, lesser carriers.

The Shadow Treasurer must force the Rudd Government to take action against misleading and deceptive advertising practices. All-in-one pricing must be the industry standard. That is the only route that passengers have to discover whether the charges under taxes and surcharges are legitimate in scope (for example, can Flight Centre pad the total for taxes with its own fees?) and whether they are legitimate in quantum (for example, in my case, what part of the taxes and surcharges was I overcharged by Flight Centre?).

There are three options that Mr Turnbull can promote.

Option 1

Airline travel advertising must clearly indicate the full price the consumer must pay, including all fees and supplementary charges. It is irrelevant if the fees are charged by the airline, by airports, by governments or as in the case of Flight Centre, by the travel agency. The price the consumer sees in an advertisement must be the all up price consumers will pay when buying their travel.

For instance, fly Sydney to Hong Kong for $1,573. No more to pay! (In this case, the price includes $270 fuel surcharge; $65 Macquarie Airport Charges; $50 Australian Government taxes; $29 HKG Airport charges, $31 PRC Government taxes and $28 Flight Centre “ticketing fee”. Note: there will be no break up of the taxes and charges given. But only an all-up price will be advertised).

Option 2

An all-in-price advertising requirement providing the advertised price plus clear and prominent disclosure of all supplementary charges the consumer will pay, and their value. In this option, the consumer will be required to add the advertised price with the supplemental charges to ascertain the full and final price.

For instance, fly Sydney to Hong Kong for $1,100+ (Where the airfare excludes $270 fuel surcharge; $65 Macquarie Airport Charges; $50 Australian Government taxes; $29 HKG Airport charges, $31 PRC Government taxes and $28 Flight Centre “ticketing fee”).

Option 3

An all-in-pricing requirement provides for one entire all-in-price, but advertisers are permitted to separately list the supplementary charges and their value.