Is it time for fuel surcharges to go?

Virgin Australia cut fuel surcharges on flights to the U.S. Should other ailrines do the same? Photo: Virgin Australia. 

Virgin Australia cut fuel surcharges on flights to the U.S. Should other ailrines do the same? Photo: Virgin Australia. 

Is it time for airlines to drop fuel surcharges?

Kevin Mitchell, chairman of a group called the Business Travel Coalition, believes so. Mitchell wrote this week to the U.S. Department of Transportation asking the government to investigate how airlines have been levying these surcharges, sometimes called "international surcharges."

"As DOT will be well aware, oil prices have plummeted some 50 percent over the course of the past year while most U.S. airlines have left their often outsized fuel surcharges in place," Mitchell wrote. "This practice therefore constitutes an unfair and deceptive act or practice and an unfair method of competition."

With only a few exceptions - Virgin Australia and Qantas among them - airlines have clung to the extra fees for long-haul flights, even as the price of fuel has dropped considerably. 

"In the investigation that we urge DOT to conduct, we call on DOT to hold the airlines assessing fuel surcharges to account -- by requiring them to substantiate on a route-by-route basis that the fuel surcharges do indeed reflect the actual costs of fuel per passenger over some baseline amount," Mitchell wrote in the letter, dated Feb. 9. 

The airline industry generally has defended the practice. In an interview with NPR News last week, Jean Medina, a spokeswoman for Airlines For America, an industry trade group, said the surcharges remain necessary. She said they go toward paying for more than just fuel. 

"While airlines are reporting profits, it's modest," Medina told NPR. "While fuel has come down, other costs have been increasing — costs of labor, cost of aircraft rent, cost of buying new planes."

In a way, Medina is right. These surcharges may have been created as a way to defray high fuel costs. But somewhere along the way, airlines got wise with the fine print. 

Most big airlines don't actually call these fees "fuel surcharges." Instead, as Brett Snyder -- better known as Cranky Flier -- explained in 2012, they're known as "international surcharges." On your ticket, the industry uses the two-letter codes 'YQ' and 'YR' to denote these charges.

Since many airlines don't classify the charges as fuel related, I'm not sure the DOT is going to tell carriers to switch their practices. But I think airlines should probably charge appropriate fares and drop these extra fees. Wouldn't that make the process more transparent?

What do you think?