{"id":41201,"date":"2023-07-27T12:16:40","date_gmt":"2023-07-27T16:16:40","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/summer-is-high-fees-season-how-hotel-airline-and-ticket-charges-can-add-up\/"},"modified":"2023-07-27T12:16:42","modified_gmt":"2023-07-27T16:16:42","slug":"summer-is-high-fees-season-how-hotel-airline-and-ticket-charges-can-add-up","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=41201","title":{"rendered":"Summer Is High Fees Season. How Hotel, Airline, and Ticket Charges Can Add Up."},"content":{"rendered":"

It\u2019s the peak of summer, which can also mean peak \u201cjunk fee\u201d season.<\/p>\n

These fees are those last-minute charges that show up during the final stages of payment for event tickets, vacation rentals, and other services. No matter the name they go by\u2014service charges, convenience fees, or processing fees\u2014they all can make it difficult for consumers to understand the true cost of a purchase up front, and can cost U.S. shoppers billions annually.<\/p>\n

\n

Such charges entered the spotlight last year after consumers fought through TicketMaster\u2019s sky-high prices and long wait times amid overwhelming demand for tickets to Taylor Swift\u2019s Eras Tour. The debacle caught lawmakers\u2019 attention, leading President Joe Biden to meet with Ticketmaster parent Live Nation Entertainment, Airbnb, and others in June. The companies pledged to implement an \u201call-in pricing\u201d model this September, allowing customers to see a ticket\u2019s full cost, including fees, before reaching the checkout.\u00a0<\/p>\n

If the White House has its way, more fee regulation could be on the horizon. Here are some of the industries, companies, and charges that could be affected.\u00a0<\/p>\n

Live Event Ticketing<\/h2>\n

\n Live Nation
\n (ticker: LYV) became a prime example of these fees with the Eras Tour ticket fiasco last year. Some nosebleed tickets to see Swift topped $1,000 because of TicketMaster\u2019s dynamic pricing model, which adjusts a ticket\u2019s cost\u2014and as a result, the corresponding fees\u2014based on demand.\u00a0<\/p>\n

Last month, the company said it has been \u201cadvocating for all-in pricing to become law for many years.\u201d Fellow ticketing giant SeatGeek has also faced criticism over fees and promised to implement all-in pricing.<\/p>\n

The average ticket\u2019s service fee equals about 27% of its face value, the Government Accountability Office estimated in 2018. For example, tickets to see Stevie Nicks in Pittsburgh this fall start at $95 on Ticketmaster. But a $29 service fee, $5 facilities charge, and $7 order processing fee bump the final price by 43% before taxes.\u00a0<\/p>\n

While venues set service and facilities fees, Ticketmaster keeps a portion to handle operating costs for technology and employees, a Live Nation spokesperson told Barron\u2019s<\/em>.<\/p>\n

\u201cIf these fees went down, venues may have to charge artists more nightly rent, which would likely result in higher face-value ticket price,\u201d the spokesperson said.\u00a0<\/p>\n

Vacation Rentals<\/h2>\n

Vacation-rental platform
\n Airbnb
\n (ABNB) has also come under fire for its various fees.<\/p>\n

In addition to an Airbnb stay\u2019s nightly rate, the host\u2019s cleaning fee, and occupancy taxes, customers must pay the platform\u2019s service fee. The company\u2019s website says most of its service fees total less than 14% of the booking subtotal, which includes cleaning fees. The service fees cover Airbnb\u2019s liability insurance costs and other \u201cproducts, services and support,\u201d a company spokesperson told Barron\u2019s.\u00a0<\/em><\/p>\n

The platform rolled out an all-inclusive pricing tool in December, which allows users to toggle and see the total cost of their stay before taxes,\u00a0<\/strong>rather than just the base nightly price.\u00a0<\/p>\n

However charges are displayed, they still add up. A weekend stay at a condo in Naples, Fla., costs $274 before fees on Airbnb. But with a $147 cleaning fee and $60 Airbnb service fee, the price of the stay balloons roughly 76% to $481, excluding taxes.<\/p>\n

Hotels<\/h2>\n

Vacation rentals aren\u2019t the only getaways adding charges. Many hotels, including from international brands like
\n Hyatt Hotels
\n (ticker: H) and
\n Hilton Worldwide Holdings
\n (HLT), add resort fees onto their nightly rates for amenities such as Wi-Fi, parking, pools, and gyms\u2014particularly among higher-end properties.<\/p>\n

Some states have taken action against these charges. In May, Texas Attorney General Ken Paxton filed two separate lawsuits against the Hilton and Hyatt hotel chains for advertising hotel prices that didn\u2019t display all fees, which he called \u201ca lack of transparency.\u201d <\/p>\n

Hyatt plans to begin displaying all-in room rates for hotels in the Americas \u201cvery soon,\u201d a company spokesperson told Barron\u2019s.<\/em> A
\n Hilton
\n spokesperson said mandatory fee decisions are made at a property level, but stressed that added charges are always fully disclosed on the company\u2019s booking channels. <\/p>\n

Earlier this year,
\n Marriott
\n opted to bundle its resort fee with a room\u2019s nightly rate to show an \u201call-in price\u201d at booking, after Pennsylvania\u2019s attorney general fined the hotel operator over its resort fee transparency.<\/p>\n

\u201cWe have long been focused on ensuring that any resort\/destination fees charged by hotels are separately and clearly stated,\u201d Marriott said in a statement to Barron\u2019s<\/em>. \u201cWe recently made changes to update our room rate display and further enhance the way these fees are disclosed, leading the industry on this important issue.\u201d<\/p>\n

In a 2022 analysis of hotels owned by six major chains, personal finance site\u00a0<\/strong>NerdWallet reported that\u00a0
\n Wyndham Hotels & Resorts
\n (WH) charged the most expensive resort fee relative to its room rates\u2014equaling\u00a0<\/strong>as much as\u00a0<\/strong>6.5% of its average nightly room price\u2014usually totaling between $30 and $50. <\/p>\n

For instance, Barron\u2019s<\/em> found that a $129 one-night stay at Wyndham\u2019s New Yorker Hotel in Manhattan adds a nightly resort fee of about $33 for access to a business center, gym, and other amenities, according to the company\u2019s website. Access to a fridge and coffee maker in the room tacks on another $80 in fees.\u00a0<\/p>\n

Resort fees aren\u2019t overwhelmingly common at most of Wyndham\u2019s hotels, including its economy and midsize locations, a company spokesperson told Barron\u2019s. <\/em>Those that do have such charges prominently disclose them before booking, the spokesperson said.<\/p>\n

Airlines<\/h2>\n

Airlines have become well-known for peppering charges across passengers\u2019 travel experience\u2014with extra fees for baggage, seat selection, and Wi-Fi.\u00a0<\/p>\n

Budget airlines like Frontier and
\n Spirit Airlines
\n (SAVE) often offer cross-country flights for less than $100, but their more affordable rates typically include fewer amenities.
\n Frontier Group Holdings
\n (ULCC), for instance, allows passengers to have one personal item each flight, then charges an average of $58 for each checked bag and $63 for a carry-on, while seat selection adds an extra $23, according to a NerdWallet analysis. Those fees combined result in additional charges averaging about $147 for a one-way, domestic Frontier flight.<\/p>\n

Frontier has long positioned itself as an \u201cunbundled\u201d carrier, where consumers pay an upcharge for each amenity. Travelers can cut some costs by bundling their seat selection and baggage fees. Frontier didn\u2019t respond to requests for comment.\u00a0<\/p>\n

Of course, many other airlines tack on additional fees during the flight booking process. Spirit tacks on a fee for all seat selection on flights, while other competitors often charge more for favored seating. The majority of carriers also charge customers a separate fee for their checked baggage.<\/p>\n

Write to editors@barrons.com<\/p>\n<\/p><\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

It\u2019s the peak of summer, which can also mean peak \u201cjunk fee\u201d season. These fees are those last-minute charges that show up during the final stages of payment for event tickets, vacation rentals, and other services. No matter the name they go by\u2014service charges, convenience fees, or processing fees\u2014they all can make it difficult for […]<\/p>\n","protected":false},"author":1,"featured_media":41202,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-41201","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-markets","tag-featured","post_format-post-format-gallery"],"yoast_head":"\nSummer Is High Fees Season. 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