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This secret trick could save you money on airfare — but beware

With December just around the corner, it’s little wonder that travelers are scrambling online to book tickets home for the holidays. But along with travel aggregators like Orbitz, Kayak and Travelocity, there’s a new player in town generating a lot of buzz lately: Skiplagged. It’s little wonder why. The site promises lower fares than any of them through a little-known loophole called “hidden-city” fares. The tactic can save people so much money that United Airlines and Orbitz are desperately trying to sue it out of existence.

Sound too good to be true? The prices are quite real, but the consequences of buying tickets this way, from potentially losing all your frequent-flier miles to getting billed retroactively, aren’t always spelled out up front.

Here’s how hidden-city booking works: Let’s say you’re planning a trip from Portland to New York City, and the airline wants $250 for a one-way ticket. Through the intricate quirks of an airline’s advanced route and price planning, a ticket from Portland to Boston with a layover in New York City might actually be cheaper, at $150. If you book the ticket from Portland to Boston and just leave the airport when you arrive in New York City, you save $100. New York City is the “hidden city” in this itinerary.

If you’re caught, you won’t go to jail, but the punishment could be severe.

Essentially, you book a flight to a destination you never intend to make it to with your intended destination as a connection, and save some money. But airlines view your $100 savings as $100 of missing revenue, and therefore ban this form of travel in the terms and conditions you agree to when you buy a ticket (it’s such a sore topic, none of the airlines we contacted responded to our queries).

From an airline’s perspective, connecting flights are a way to offer fliers cheaper fares than nonstop flights, but still try to make a profit. Hidden cities are a consequence of the way they price tickets – based on the origin and destination cities.

“Airlines aren’t pricing flight segments; their pricing is set in order to get you from point A to point Z regardless of how many stops are in between,” explains Brett Snyder, president and author of one of the airline industry’s most recognized blogs, Crankyflier.com. “If people are buying one product from point A to point Z but they are getting off at point G, then they are impacting the airline revenue forecasts.”

Related: United Airlines adding iPads at Newark airport gates, revolutionizes food ordering

Finding a hidden-city fare used to be a convoluted process that has required more time than it was worth for all but the most frugal fliers. But Skiplagged cuts out the legwork and shows you hidden-city fares whether you ask for them or not. What was once a small loophole among a small group of savvy fliers has turned into a well-publicized deal anyone can take advantage of with minimal effort.

“I can’t say I know how common it is in practice, but it’s certainly one of the more well-known tricks out there,” Snyder says. “The only reason people do this is to game the system and save money.”

Airlines may not like the practice, but it’s technically not illegal. In its lawsuit, United and Orbitz say Skiplagged.com is “intentionally and maliciously” promoting “prohibited forms of travel,” and giving the false impression that these fares are legitimate and, to the eyes of the Internet user, affiliated with United and Orbitz. They argue that not only does it mess with their operations (travel agents and travel sites aren’t allowed to offer customers the hidden-city option), but also it takes money away.

skiplagged

Snyder, who agrees with United and Orbitz’s lawsuit, finds hidden-city bookings unscrupulous, and advises against using it.

“Since booking hidden-city tickets is against the contract of carriage for most airlines, I would never suggest using this,” Snyder says. “We tell [clients] that it’s not allowed per airline rules and we aren’t able to help them with it.”

For those who do it successfully, it usually involves flying under the radar. That means never using your frequent-flier account, never checking a bag (checked bags go all the way to their final destinations), and only purchasing one-way tickets.

Still tempted? If you’re caught, you won’t go to jail, but the punishment could be severe.

“I have heard of chronic abusers being caught and charged the fares that they avoided by gaming the system in the past,” Snyder says. “There is no other benefit [other than saving money] and there are plenty of cons that could end up costing you if you’re caught.

“Airlines aren’t pricing flight segments; their pricing is set in order to get you from point A to point Z regardless of how many stops are in between.”

“While they won’t catch everyone doing it, they certainly can catch people,” Snyder adds. “And if it becomes a much bigger problem, then they will start stepping up enforcement.”

Related: Take the stress out of holiday travel with these gadgets, apps, and tips

In the lawsuit, United Airlines claims that hidden-city bookings “adversely affect United’s ability to estimate head counts, which can not only cause disruptions at the airport gate, but can also require mechanical tweaks, such as variations in the amount of jet fuel needed for each flight.”

This is somewhat true, though airlines likely know and can predict the percentage of people who may miss connecting flights, and if this practice takes off, they’ll likely figure out the percentage of people who might use the hidden city trick, as well.

Of course, because it messes with head count, hidden-city fliers on full flights may take away a potential seat that another flier desires, and if enough people surprisingly skipped out, the airline may adjust the fuel on board to save money, which can delay takeoff.

But overall, the biggest fear is that since airlines hate this practice, we could see fares go up on certain flights if hidden-city bookings become more common.

There are plenty of tricks to find cheap fares online. And while you won’t go to jail for rolling the dice on hidden-city tickets, you should know the risks.