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Fare Surcharges Arbitrary.

Article Excerpt
Airline fuel surcharge structures have no clear and consistent methodology, no direct correlation with the cost of fuel and little consistency in their application--even within a single airline on the same flight, according to examinations of fare data and discussions with airfare analysts. Corporate travel buyers and industry organizations are bemoaning the surcharges' placement in fare filings that leave the fees out of the realm of corporate discounts, and in some cases nonrefundable.

Fuel surcharges on international and many domestic routes are assessed on top of the base fare, leaving surcharges--a growing part of the overall cost of carriage--largely left out of corporate discounting.

Advito vice president Bob Brindley said fuel surcharges fall "on the more irrational side of the whole airline pricing spectrum. The discount applies off of the base fare, so it doesn't apply to the other fees and unbundling that's going on. In some domestic markets, the fuel surcharge is not an add-on, it's part of the base fare. Whenever it's part of the base fare, and those are primarily domestic U.S. markets or low-cost carrier markets, the discounts do apply."

The United Kingdom's Institute of Travel Management and Guild of...

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