Personally I think the opposite: that there isn’t actually sufficient competition for whatever reason. It seems to me that people choose the lowest fares because unless you pay double there’s not going to be a meaningful difference between slightly different economy fares. Likewise AFAIK there is no option to prepay or pay a deposit to reserve a rental car and have it be guaranteed.

The challenge is that it’s clear the vast majority are willing to put up with a lot to get a low fare.

And that includes me. I remember flying return from SFO to Barcelona for $500 on a budget international airline (Norwegian Air). No food service, no drink service, but it was a A380 fleet so quite comfortable. Read the fine print and you avoid all excess charges like printing tickets, bagged checkin fees, etc. Cheaper than flying return from SFO to NYC.

For those that aren’t willing to go cheap, there is now Premium Economy which seems to be growing in size as a class. I think Singapore Airlines now run flights that dont have basic economy any more. It’s either premium economy or business.

The complainers are not a cross section of customers. The complainers generally are high end luxury consumers who can and would pay more but there aren't enough of them to actually actually matter beyond noise making. The people who are penny pinching are happy they can get the right good or service at the right price.

If it were easy(-ier) to compare apples to apples with the “add ons” I wouldn’t care. But when one airline is $50 for a bag on a certain flight but $30 on others and another airline is $20, it’s hard to know which airfare is actually cheaper. And this is one way they keep you married to them, with rewards and so on, by eliminating those for loyalty. Amex Platinum avoids most of this, but you can only get the nickel and dime repaid from one airline at a time.

Thank you for reminding the room that markets can fail to provide at a middle price tier because there simply aren’t enough people willing to pay. The only remaining options are the super-premium, which most of what would have been the middle market can’t afford, and basic economy.