The nation’s three largest airlines are dropping change fees on domestic travel, a sign of an industry desperate for customers as the pandemic lingers on.
Air travelers have long disliked change fees, ranging from $200 to $500. The fees are designed in part to cover the cost of a lost opportunity to fill a seat if a passenger can’t go at the last minute. But they turned into a huge moneymaker for airlines.
Now, the persistence of the novel coronavirus in America, and its downward effect travel, has forced the airlines to give up many of their old ways of doing business. The uncertainty created by the virus has led to jumble of ad hoc refunds, booking flexibility and other exceptions.
Chicago-based United was the first to announce the elimination of change fees Sunday and Atlanta-based Delta and Dallas-based American quickly followed on Monday.
Delta, the dominant carrier at Minneapolis-St. Paul International Airport, is immediately — and permanently — eliminating change fees for all standard airfare on flights within the U.S., Puerto Rico and U.S. Virgin Islands.
The one exception is Basic Economy tickets, which are the cheapest airfare that lack many of the perks and amenities included with other fare classes. But Delta said Monday it will extend its previously-announced waiver on change fees for international flights and Basic Economy fares through the end of the year. It is also extending its travel-credit expiration to December 2022 for tickets booked before April 17, 2020.
“I think customers in general should be thrilled. This is the way travel used to be and I’m glad to see them returning to it,” said Jason Cochran, editor in chief at Frommers.com.
They are giving passengers back what they took away from them when consolidation had given the airlines power, Cochran said. “They aren’t behaving like impassive monopolies anymore,” he said. “They are competing again and the competition is good for us. Though they are still doing things in lock-step.”
Change fees became a hefty revenue stream for the major U.S. carriers in recent years. In 2019, Delta collected more than $830 million from passengers in change fees, or 1.7% of its $47 billion in revenue. American tallied nearly $819 million in change fees last year and United $625 million, according to the U.S. Bureau of Transportation Statistics.