Continental Airlines adjusts base fare structure for segment fees and passenger facility charges

Continental Airlines today announced that, effective immediately, the airline will no longer reduce its base fare to compensate for the government-imposed segment fees. Previously, Continental reduced base fares whenever this segment fee exceeded $6.00. A segment is defined as a takeoff and landing.

This segment fee is charged in addition to the 7.5 percent excise tax on airline tickets, the federal security fee of up to $10.00 per roundtrip, and airport-imposed passenger facility charges of up to $18.00 per roundtrip.

In addition, the airline stated it will no longer reduce its base fare to cover passenger facility charges of $4.50 per departure for customers connecting at Cleveland/Hopkins International Airport.

"For six years, Continental Airlines has reduced base fares to rebate customers for the cost of domestic segment fees, and for the cost of passenger facility charges at Cleveland, at a cost to the company of tens of millions of dollars each year," said a Continental spokesperson. "The current depressed revenue environment and the continued fall in average fares paid in recent years dictates this change. Customers will now see the full impact of taxation on their ticket purchases."

The cost of taxes and fees figure prominently, particularly for customers paying lower fares. For a customer buying a $151.50 roundtrip ticket on Continental to fly from Baltimore to Kansas City with a connection in Cleveland, for example, Continental collects a base fare of $105.11, with the $46.39 difference funding federal excise taxes, federal segment charges, federal security fees, and airport passenger facility charges.