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Misery works: airlines making money on baggage fees
The one thing nobody says about the "nickel and dime" strategy is that it can work. For the airline industry, charging passengers for extra bags translated to more than $1 billion in lifeblood to a struggling business last year, according to the Department of Transportation. As much as you may hate to shell out that extra cash, last year, it went to businesses that desperately needed it.
Before the financial decay spread to every corner of the business community last year, airlines typically allowed two pieces of checked luggage per person and charged for anything else that followed. Then, United Airlines started demanding that passengers throw down $25 for a second bag, with US Airways following to the tune of $15.
It adds. Up. United brought in an extra $133 million. Delta picked up an extra $177 million. American Airlines wins with $278 million last year from baggage fees. Even Southwest Airlines pulled in an extra $25 million. Rick Seaney, CEO of Farecompare.com, believes that baggage fees could be worth up to $3.5 billion in 2009.
Filed under: North America, United States, Airlines
Reader Comments (Page 1 of 1)
Mark May 15th 2009 11:05AM
I hate to sound like an airline apologist, but saying that the airlines are making "extra" money is quite misleading. The airlines have simply shifted some of the price of a ticket to baggage fees. Instead of everyone on the plane paying $10-20 more for their ticket, people who choose to travel with more bags are paying $15-25 more. As someone who usually travels light, I appreciate this.
The fees also create an incentive to travel light. Weight plays a big role in how much fuel a plane burns. Less fuel = less emissions = happier environment.
So yes, the fees are annoying because they are a change from what we were used to, but in the end, they reward those of us who happen to pack light.
Tom Johansmeyer May 15th 2009 9:57AM
You don't sound like an apologist at all. In fact, that's a pretty good point.
I don't even find the fees all that annoying. After all, if you want to fly, you have to pay. Airlines that aren't making any money need to find ways to change that. Retailers, service providers, etc are trying to find new ways to get customers to spend more. Why can't the airlines?
Snife May 16th 2009 8:30AM
I understand that weight means more fuel which means more money but the problem I have is with underhanded and excessive charging.
'Discount' airlines, particularly in the UK like Ryanair, advertise flight prices but I always find them to end up being more expensive than decent airlines like BA or BMI as you have all these extra charges just to make the flight barable. They have a lower baggage allowance than other airlines and charge 2-3 times as much for exceeding the limit.
The fact that I might pay £50 for a flight with them, which entitles me to my weight (90kg) and a 15kg bag, to fly the same total weight as excess baggage (which obviously wouldn't be allowed but doing for comparison purposes) would cost £1575 - that to me is underhanded and is an attempt to get people to book 'cheap' flights and then screw them every way they can. I would love not to support such airlines but often have little choice because of times/destinations.
ellieebony Jun 1st 2009 2:02PM
I think the airlines are offering their customers a dis-service by charging fees to check in baggage. People that fly out of the Greater Cincinnati Airport pay the most money to fly than any other airport in the country. For people that are handicapp it is virtually impossible for them to carry-on luggage. Why should the disabled have to pay for something they can't do? Are the major airlines discriminating against people with disabilities? I think so? If you don't, I challenge you to tie a rope around your legs, rent a wheelchair, push yourself and carry a 40 lb piece of luggage from the spot where you are dropped at the airport, through the terminal and to the plane, and then do this all over again once you reach your designation. See if you can do it? I bet you can't.
Also keep in mind disabled people need to bring medical supplies, etc with them when traveling so the excuse - travel lightly is difficult to do.
Just my thoughts and feelings.