The Truth About Airline Fuel Surcharges

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I’ve seen all too many travel writers—who should know better—whining about the fuel surcharge horror. Have you heard something like this? “Fares are really high to Asia and Europe this year, plus you have to add around $400 in a fuel surcharge.” If you have, then you’re only getting half the story.

The truth is that the only figure that matters is the total price—base fare plus fuel surcharge—and looking at either separately is rank idiocy.

Here’s the problem. Some airlines, mostly based outside the United States, are splitting their true fares into a phony base fare plus equally phony fuel surcharges. As a case in point, I checked flights from San Francisco to Munich, leaving May 16 and returning on May 30, through both Lufthansa and United. Here’s what I found:

• Lufthansa’s total round-trip fare for the route’s only nonstops was $2,140, figured as a base fare of $1,560 plus fees and taxes of $580, of which $420 was for a “fuel and security” surcharge.
• United’s total round-trip fare for the exact same flights, but sold as a United flight through a Lufthansa codeshare, was also $2,140, this time figured as a base fare of $2,013 plus taxes and fees of $127.

And there you have the story in a nutshell.

The real fares on either line are virtually identical. The two lines just chose to present the fees differently: honestly on United, not so honestly on Lufthansa. Parenthetically, both lines offered lower fares on some connecting itineraries, but fares to Europe really are high this summer.

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When you ask an airline why it goes through this charade, you get a long sermon about fuel costs, but that doesn’t really answer the question. The question is why they don’t just raise fares to cover increased fuel costs, the way U.S. lines (and most other businesses) do—why instead they split the real fare into two components, and they never answer that.

I have a few theories:

• So they can sock travelers on supposedly “free” frequent flyer awards and companion tickets with part of the fare. As far as I can tell, most big foreign airlines are pulling this scam on their own frequent flyers.
• To make their fares look much lower than they really are, at least in countries where they’re allowed to post fares that way.
• So they can lower the fare basis on which they pay commissions.
• So they can raise the true fares on routes where fare increases still need some sort of outside approval—if true, the only legitimate reason.

But, in the final analysis, the reason doesn’t mean anything. It’s what they do that matters.

Fortunately, the U.S. government won’t let airlines feature fares that exclude fuel surcharges; the only way to find them is to click on separate “explanation” boxes. But some third-party sites—especially self-styled consolidator and discount agencies—still post fares that exclude the surcharge.

Separate fuel surcharges are a genuine scam. You aren’t likely to encounter a problem if you buy through a big airline’s U.S. website or a big online travel agency, but you still encounter it in other ways. My suggestions for coping:

• Totally ignore any reports you read about fuel surcharges. The total fare matters, not how any individual airline or agency arrives at the total.
• You can get gouged when you try to book a frequent flyer award using miles in a foreign line’s program. Instead, use the foreign line’s credit to score a seat on a U.S. partner. You’re usually OK using your miles on a U.S. line for a flight on a foreign partner: The only exception is that you have to pay extra to use American Airlines miles to fly British Airways. Similarly, if you’re eligible for a companion ticket, get it on a U.S. line.
• Figure any online agency that says its posted prices exclude fuel surcharges is trying to scam you, one way or another. And if the deal looks really terrific, anyhow, call/email and ask for the true fares before you buy.

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