UK tops scale for hidden airline charges

2012-06-19 13:20
Britain is the worst country when it comes to passengers facing hidden extras when booking flights, according to a Travelmole report.

The research commissioned by WorldPay and carried out by Loudhouse in February, involved 4 500 consumers across nine countries - UK, US, China, Japan, Brazil, Finland, Spain, Germany and France. Also questioned in the survey were decision makers at 51 airline merchants, including low cost, regional and global carriers.

With 41%, Britain has the highest number of consumers most likely to be presented with hidden surcharges during the payment process. The country with the lowest in surcharges was Japan, coming in at 8%.

Issues considered in the study included booking and payment methods revealing the following research:

- surcharge transparency is one of the biggest issues for consumers across all countries surveyed, with 28% feeling they had been presented with "hidden" charges

- 65% of customers said they would be prepared to pay a percentage of their flight cost towards surcharges.

- 3.8% of their fare was the global average consumers would be prepared to pay in surcharges.

- over the last 12 months, 59% of consumers bought tickets through budget airlines, 58% through traditional airlines and 20% through package airlines

- the average time taken to complete the online payment process is 25 minutes.

One thing is clear from the survey, passengers want  the total costs to be made clear and according to  Mike Parkinson, VP of airlines for WorldPay, “Consumers accept that taxes and fees need to be paid and are willing to pay a percentage of their ticket price to cover these costs. In the UK, the percentage that a consumer is prepared to pay is higher than the global average (4.57% vs. 3.81%).

SAA CEO Siza Mzimela has also just announced that the parastatal is planning to raise surcharges to comply with the European Union Emissions Trading Scheme on its services to London, Frankfurt and Munich.

South Africa has not been the only country to complain about the EU emissions tax with the US, China, Russia, Australia and India, opposing it in October 2011 just before it came into effect in January 2012.
Appeals have been made for the EU to delay the tax surcharge for two years in order to allow a global plan to be put in place by the International Civil Aviation Organisation (ICAO), the body mandated to set and implement global civil aviation standards and regulations. According to SAA , it plans to reduce the impact of the charge by putting “fuel-saving and carbon-emission reductions initiatives” in place.

All of this comes on the back of warnings by International Air Transport Association that more airlines are facing financial collapse.

Combined losses are expected to exceed $1billion (about R8.3-billion) for 2012, the global aviation body said, the International Air Transport Association warned today. This was up by more than $500-million from the figure predicted in March, according to Tony Tyler, IATA Director General.

The banking crisis is expected to further depress the situation, with IATA's chief economist Brian Pearce warning that if the recession sweeps across Europe, more airlines may go bust.  "I think there is a serious risk to the financial viability of some airlines," he said. "We have already seen some airlines go out of business and there is a clear possibility it will continue."

Tyler told IATA's annual general meeting in Beijing that the crisis in Europe was now a bigger concern among airlines than rising oil prices.

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