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“Tap Watergate” to $50 Carry-Ons, How Spirit Airlines Justifies Sky-High Fees

$50 for a carry-on bag? $3 for water? Spirit Airlines is infamous for charging outrageous fees for nearly everything. Can you still save money flying Spirit, or should you skip this airline altogether?


Spirit Airlines is infamous for low published fares and fees for everything...and that includes water.There’s one good thing about flying on someone else’s dime: If the airline socks you with hefty fees, you can expense it. But my mom, who grew up in the Great Depression, taught me to be frugal with other people’s money, too.

So when a corporate client asked me to find the lowest airfare from Chicago to Minneapolis, I had several choices in the $150 range. Spirit Airlines came in cheapest — not by much, maybe $25 — but it was enough of a discount to entice me into giving Spirit a try.

So much for enticement. Never before have I paid $50 for a carry on bag. Never before have I been deprived the privilege of getting so much as a glass of tap water on an airplane. Instead, Spirit serves bottled water, which will cost you $3. (I nicknamed this shocking discovery “Tap Watergate.”)

If you’re not familiar with how Spirit Airlines makes money, it’s simple: The airline undercuts nearly every competitor on ticket prices to get people aboard, then charges fees for almost everything else you might want: Carry-ons, water, you name it. Want to print out your boarding pass? That’s $10.

The fees are one thing, but never before have I flown an airline ranked so low in customer service that it’s earned a dubious worldwide distinction. As ace Consumerist watchdog Chris Morran noted in May, Spirit was the only U.S. carrier to make the list of the world’s worst airlines. Reviewers on SkyTrax rank Spirit right up there with Tajik Air and Turkmenistan Airlines (the absolute worst). It finished number 11, with an average score of 2 out of 10 among more than 1,100 posted reviews.

And yet, my interview with Spirit CEO Ben Baldanza gave me pause. Is it possible that Spirit plays ball so differently, air travelers like me simply aren’t used to how they work? That is: If you show up at the airport needing to check a carry-on bag and print a ticket at the counter, you’re looking at $60 in fees right there.

Those might seem like cash grabs, and to many consumers, they simply are: a recent Fox News story shined a spotlight on five outrageous Spirit Airlines fees.

But to hear Baldanza tell it — and he has a point — Spirit’s system works if you know all these things in advance. If you print your ticket at home, limit yourself to one carry-on, and take a debit card on board to purchase water if you need it, Spirit then becomes an economical alternative to flying the legacy carriers.

“Customers who don’t bring bags are saving tremendously,” says Baldanza. “In 2007, the last year we competed as a traditional airline, the average ticketed fee was $101.71, and that included bags. In 2012, even with every bag fee we collected — carry-on, overweight, checked — that price was $100.62. And fuel prices have tripled in that time.”

In Baldanza’s view, the Spirit way makes perfect sense: Break down a traditional airline ticket into its component parts, and it allows customers to plan ahead and eliminate as many of those add-ons as possible, saving money. In fact, Baldanza goes so far as to draw an analogy between his airline and Dollar General stores, or fast food restaurants: “No one is surprised when they go to McDonald’s and they don’t see filet mignon on the menu,” he says.

Yes, but … everyone would be surprised if McDonald’s charged $20 for a side of ketchup or a few extra napkins. And that’s the crux of my beef: Many travelers (myself included) don’t consider tap water, a second carry-on or the 30-second act of a clerk printing a ticket to be “add ons.” So you can imagine how many people have complained about these charges when flying Spirit for the first time.

Judge for yourself how Baldanza explains the ticket-printing fee: “Why are speeding tickets expensive? When we have to transact at the gate, that delays everyone, and we can’t allow that to happen. We want to discourage that behavior.”

Yet to expand on his analogy, it baffles me why an airline would want to make its flyers feel “penalized” for the “bad” behavior of asking for a printed ticket. Is that being economical? Or making customers feel angry and diminished for an innocent request? Even cops let speeders go with a warning.

As for why Spirit charges $100 if you bring a second carry-on to the gate, he says it’s because people consciously try to cheat on the $50 fee at ticket kiosks: “There are signs everywhere. People don’t forget.”

Ah yes, but … people are distracted. They are nervous. Air travel is stressful, even under the most ideal circumstances. And if you’re shaking up the paradigm as much as Spirit has, is it reasonable to expect that all travelers read the fine print, or look out for baggage signs amidst a sea of countless other airport postings and ads begging for their taxed attention spans? Don’t think so.

Indeed, Spirit has a self-styled strategy for saving consumers money. It’s very different — shockingly so — but it can work. I get that.

But when consumers get hit with these fees for the first time, they feel like it’s a “gotcha.” And that burned feeling hurts. Bad. So give Spirit low marks for terrible marketing and communications in terms of its public outreach, and efforts to soothe those ruffled feathers. I give Baldanza credit for recognizing this, in part, when he told me, “A lot of people don’t fully understand our model, and it’s part of our job to align customer expectations with what we do.”

Here’s an easy way to do that: Give every first-time flyer on Spirit a pass on carry-on baggage and other fees — that’s right, a pass. But accompany it with a flyer or email that explains what the fees will be from now on, and a primer on how to prepare. I can see Baldanza waving his arms and saying, “That’s going to cost money!” To which I’d reply: The overwhelming conventional wisdom in business is that if you take care of your newest customers, they will come back again and again and again. Fail to do that, and they may never return.

Texas car dealer magnate Carl Sewell, in his bestselling 1990 book, Customers For Life, famously boasted that the fanatical loyalty his dealerships garnered by thrilling customers was worth $517,000 over the lifetime of each buyer. That’s half a million dollars. So while Baldanza’s approach may be penny wise, you have to wonder if it’s pound foolish. I don’t want to have to study a long list of fees to dodge before I get on an airline. It’s Spirit’s job to help me and my fellow air travelers with that task. If they do, I’ll be theirs for life.

Besides, I’m paying for this service, dammit. Treat me with enough disregard and I’ll gladly pay a higher fare somewhere else, where I feel like the airline and its staff truly care about me and want to take the stress out of travel. Cheap is good: As Baldanza notes, it gives folks otherwise unable to afford air travel a chance to get on a plane. But does it have to feel like a miserly, miserable experience?

That brings me to the issue of customer service. I’ve rarely encountered such apathetic, clueless flight crews and service personnel as I did on Spirit. This is not to say service was poor. But it was mediocre at best.

When my oversold Minneapolis-bound flight needed volunteers to take the next departure, I stepped up, as the offer of two round-trip tickets sounded good. Then I found out the next flight out was the following day. “Why not try booking me on a later flight on another airline?” I asked the Spirit rep.

And guess what? She stared off into space like a zombie, not even bothering to reply yes or no. I stood there for a minute, puzzled, before she finally said, “I’m sorry, sir,” with all the emotion of a robocall voice over. (She actually made me miss the over-inflated pep of Southwest’s employees.)

Based on what I saw, Spirit’s front-line personnel need retraining in basics that don’t cost a dime: How to smile, how to make nervous air travelers feel comfortable, how to reflect enthusiasm and cheer for the work they do.

Baldanza concluded the interview by inviting me to fly Spirit again. It was a gracious gesture on his part. And now that I know how the rules work, it’s possible I’ll choose Spirit, even for all the negatives I’ve just listed. I like a low fare, and Spirit has those in abundance.

Still, I’m trying to wash the bad taste of this last Spirit experience from my mouth. That’s not easy, given the shortage of tap water I’ve just survived. But next time, if there is a next time, I think I have just the ticket: A big bottle of orange juice hidden in my one and only carry on bag.

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About Lou Carlozo

Based in Chicago, Lou Carlozo is a personal finance contributor for Reuters Money, a columnist with DealNews.com, and a former managing editor at AOL's WalletPop.com. Contact him with story ideas for Money Under 30 at feedbacker@aol.com, or follow him via LinkedIn and Twitter (@LouCarlozo63).

Comments

  1. I have heard about these extra fees on Spirit and have stayed away; however, I think many airlines are guilty of this sort of “bait and switch” pricing and it seems to be getting worse. Not too long ago, ticket prices were posted based on “all-in” costs for the airlines. It was the airlines’s responsibility to estimate bag and food fees and price tickets accordingly. Now it is the consumer’s responsibility to research and compare all of these “add-on” fees and they are not always visible or known when booking a ticket. I don’t understand why we can’t go back to the “old way.” The government has been so fixated on fair and disclosed practices in the financial sector to “protect” consumers, but it doesn’t seem to care about those in the airline sector.

  2. Super interesting. I have wondered how they are able to charge so low. Now that makes sense!

  3. I wouldn’t call their pricing strategy a “bait and switch” or even necessarily “undercutting” the price because really, United, Southwest, etc. all include the costs of certain “luxuries” in their basic ticket price. So, you just get the option with Spirit to determine what you really want. Of course, as humans we have been conditioned to think that extra fees whether it is at the bank, cell phone bill, etc. are bad and we should avoid them at all…costs. No pun intended.

    With that being said, I flew Spirit one time and let me tell you, that was enough. No where did this article mention the approximate 7 inches of legroom that you get on one of their planes. And I am not a very tall person. I guess I am not one of the people that Ben Baldanza is targeting.

  4. I flew Spirit to Panama (the country) for a cheap backpacking trip and tickets were $350 round trip. This was about a year-and-a-half ago. However, I thought it was absolutely great. Obviously, you get what you pay for (some obvious cabin wear, the fees, plane felt older), but if you are traveling on a budget there is no better option. My biggest flight were the delays we experienced both ways (not sure if that’s spirits fault?) We carried everything on and made out like bandits on an international flight. I wouldn’t fly Spirit for my honeymoon or something nice, but for a cheap getaway, this is the way to go.