This article is reprinted by permission from NerdWallet.
Bundling is a practice popularized by third-party, online travel agencies, like Expedia
EXPE,
Priceline and Kayak, that encourages booking flights, hotels and rental cars in the same reservation. The option to bundle is also often offered through travel providers (such as when a popup surfaces on an airline’s website asking you to book a rental car, too).
Travel is complicated enough, and bundling does not do anything to simplify it. In fact, it only makes it more complicated. Here’s why you should almost never bundle travel.
Options are limited
Bundling reduces your options to travel partners only. For example, Costco
COST,
Travel does not currently offer flights with Southwest
LUV,
or Spirit Airlines
SAVE,
— removing a large list of potential flights you might otherwise book.
Similarly, Southwest Airlines encourages you to book a car with one of its eight car rental partners. And while there are a lot to choose from, some notable car rental companies like Enterprise (which is among the cheapest car rental companies) and car rental alternatives like Turo are absent.
Also, bundled travel typically requires that you book both the inbound and outbound flights on the same airline, which can limit flight options.
Also see: Is your international layover long enough? There’s plenty that could go wrong.
Changes and cancellations can be more expensive … and more complicated
When you bundle travel, you’re subject to two sets of change and cancellation policies — that of the actual travel provider, and that of the bundler you booked with. You might also be subject to two sets of fees.
With small travel agencies, it’s not uncommon to get hit with reservation cancellation fees — and that’s on top of fees charged by the travel supplier. Larger, online travel agencies are less likely to charge cancellation fees, though many sites pass on fees charged by the travel provider.
Don’t miss: ‘This is one of the coolest places I’ve ever seen’: Splurge on a stayover — or grab a cocktail during a layover — at this nostalgic airport hotel
Beyond the fees, bundling travel can create additional headaches if changes or cancellations need to be made. Here are some factors to watch out for when bundling travel:
Change and cancellation policies may be inconsistent
When you bundle, you’re subject to not just the agency’s policies, but the travel provider’s policies too. This can get complicated, as the policies may differ for each trip, even if you booked through the same travel agency as before.
You sometimes can’t make changes online
Often, making changes to one piece of a vacation package can be an annoying process.
For example, Expedia currently doesn’t allow you to make changes to vacation packages online, so you’ll have to contact an agent by online chat or phone. Wait times typically aren’t more than a couple of minutes, but they can exceed that — especially in situations like massive airline meltdowns.
Changes typically take longer
Sitting on the phone isn’t the only thing that takes time. Bundling brings an unnecessary go-between into the process of changing or canceling plans. Typically, you’ll contact the bundler you booked with, who will then go to the actual travel provider to make your changes.
The go-between can add a similar headache when it comes to getting a refund, including necessitating additional time to process refunds. Having a go-between often creates one more opportunity for changes or refunds to get lost. In fact, Expedia recommends you reach out to travel providers directly if you make changes or cancellations through Expedia but still see charges.
Plus: How to avoid those annoying resort fees and the hotels that charge the worst ones
Does bundling travel ever make sense?
While bundling presents challenges, it can sometimes work, and many bundling services are making more money than ever before. In fact, Expedia reported its highest-ever first-quarter revenue in 2023 — $2.7 billion, which is an increase of 18% compared with 2022.
A key benefit of bundling is having just one reservation to keep track of. Rather than managing multiple confirmation numbers, logins and credit card transactions, there’s just one.
Sometimes bundling can save money, as agencies can use their buying authority to negotiate lower rates — and then pass on those savings to customers. For example, Priceline claims that its customers save on average $240 per transaction when they bundle travel (e.g. flight + hotel). Meanwhile, Expedia claims that bundling saves its U.S. customers up to 10% versus booking those items separately.
See: How to choose the best seat on a plane
It’s not necessarily cheaper to bundle
But bundling isn’t always cheaper. Even Expedia’s 10% stat comes with the caveat “up to.”
Many travel providers offer better discounts when you book with them directly versus with a company that provides a bundling service. For example, Ovolo Hotels is a boutique hotel chain that touts delightful, complimentary amenities such as self-service laundry, happy hour refreshments and a breakfast buffet — but you can only partake if you book directly.
That’s largely because companies often pay commissions to the referring party, such as online travel agencies. Big hotel brands like Hilton
HLT,
Hyatt
H,
and IHG
IHG,
pay up to about 10% commission on most room revenues. Hotels can pass on part of those savings to you — meaning you might actually save money by not bundling.
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Sally French writes for NerdWallet. Email: sfrench@nerdwallet.com. Twitter: @SAFmedia.
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