• Bloomberg News, Tuesday, February 24, 2009 11 AM

Apparently there is a limit to what airlines can tack on an extra fee for -- at least if no one else does it. Saying the policy has become a competitive disadvantage, US Airways Group is dropping the fees it charged for sodas, coffee and bottled water.

The change is a retreat from the airline's "à la carte" pricing in which passengers pay more for any services beyond the basic fare. US Airways has said it expects to reap as much as $500 million this year from the fees, Mary Schlangenstein reports, including extra costs for select seats and a plan to sell pillows and blankets.

"The risk for the U.S. airline industry in unbundling its products and services was consumer backlash," says Kevin Mitchell, chairman of the Business Travel Coalition. Flight attendants opposed the fees, which were added last year, saying that dealing with unhappy passengers hampered their ability to ensure cabin safety.

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