Expedia cuts air booking fees amid travel slump

Bellevue-based Internet travel agency Expedia said today it is eliminating fees for flights booked online, extending a promotion it implemented in March amid a worldwide travel slump.

The company also said it is doing away with cancellation fees on hotel, car rental, cruise and virtually all flight reservations made through its Web site.

Expedia, the largest of the online travel booking agencies, previously charged $25 to cancel or change most hotel reservations made through its site; $50 for a cruise change/cancellation; and $25 for a car change/cancellation if the reservation was part of a package.

The new policy calls for passing on only whatever change or cancellation fees the hotels, rental car companies and cruise lines charge, said spokeswoman Amanda Watkins.

Competition among online travel sites has been heating up as fewer people book flights in the recession. Priceline.com and Orbitz also have cut or temporarily removed air-booking fees this year.

But Expedia's profits could decline without the fees, a possibility the company seemed to raise in a regulatory filing last month.

"In early 2009, Expedia.com and other major online travel agencies began offering air tickets to consumers without an associated online booking fee on a promotional basis, matching the airline supplier sites, which also do not charge online booking fees," the company said. "The promotion contributed to lower revenue per ticket for Expedia in the first quarter of 2009."

For the three months ended March 31, Expedia made a profit of $39.8 million, down from $49.8 million a year ago.

Information from Seattle Times travel reporter Carol Pucci is included in this report.

Amy Martinez: 206-464-2923 or amartinez@seattletimes.com