Unbundled Fares Worst Choice for Budget Travelers

Tuesday, October 20th, 2009

Airlines are still struggling to increase revenues in the unstable economy, and travelers are cashing in on deals on cheap tickets and affordable travel packages available online and through their travel agent. However, a recent report shows that buying airline tickets outside of a package can actually cost the passenger more.

According to a recent article by ATW Media Group, unbundled fares are more beneficial to the airlines because the airline has the ability to increase revenue through checked baggage fees, seat assignment fees and by charging for extra services and amenities.

Chris Vukelich, a senior vice president of business development at Radixx International states that the passenger service system used for pricing in the airline databases is actually a limiting factor because the carrier's view of profitability for a particular route is no longer accurate. Airlines that start to release fares to systems outside of the traditional model have to impose fees for services outside of the published fare, which means passengers may end up paying more in the long-run.

Currently, online booking sites account for a high percentage of booked travel and there are flight-only reservations available. However, most travelers can enjoy deeper discounts on air travel and overnight stays by booking a package because the extra discounts will cover the costs of baggage fees and other booking fees associated with a particular airline reservation.

This is good news for the airlines, especially since the Bureau of Transportation Statistics recently reported that the industry collected nearly $670 million in baggage fees for the second quarter of 2009. However, passengers who are looking for the latest deal on their travel packages should turn to air, hotel and car combination packages that can help to offset the costs of checked baggage fees and other services. Many booking sites are also offering no booking fee promotion fees as an incentive to book online, further lowering total costs.