Never mind the free lunch. Almost nothing is complimentary on airlines anymore, not even what many passengers consider a simple necessity: a single checked bag.
Under a plan announced on Wednesday by American Airlines, passengers already forced to pay extra for amenities like earphones, meals and snacks will have to pay US$15 to check a basic piece of baggage.
Some other carriers are charging for extra legroom in exit rows. What's next?
"Pay toilets in the coach cabin maybe," joked longtime airline consultant Mike Boyd. But airline executives aren't laughing, and other carriers refused to rule out similar fees to stow luggage in the cargo hold.
American Airlines's plan is part of a larger effort by the industry to find new ways to improve revenue in the face of soaring fuel prices and a slumping economy. The airlines anticipated a multibillion-dollar loss this year, even before oil's latest spike above US$130 a barrel.
"It's ridiculous," said Louise Schum, a 23-year-old on a 10-hour layover at Miami Airport. "Charging for luggage is the cutoff line."
Texas-based American Airlines announced the change at the same time when it said it would slash capacity and retire at least 75 older, gas-guzzling planes.
Gerard Arpey, chairman and chief executive of American parent AMR Corp, said the industry cannot withstand sky-high oil prices and must find ways to cover rising costs.
Travelers are likely to see other carriers follow suit.
"They're always going to be looking for additional ways" to make money, said Ray Neidl, who monitors the airline industry for Calyon Securities. "Customers want low ticket prices, and they seem willing to pay for extra services."
The added baggage fee amounts to a fare increase, and it comes on top of a series of ticket price increases and fuel surcharges the industry has pushed through in recent months. But it is also the industry equivalent of a trial balloon that could pop.
"There comes a time when the nickel-and-diming starts to be annoying," Boyd said.
Under American Airlines's plan, many domestic passengers who buy tickets after June 14 will have to pay US$15 each way for the first piece of checked luggage. The fee does not apply to passengers who pay full-price for tickets, elite members of its frequent-flier program or people traveling overseas.
"This is not going to apply ... to the people who can most afford it, the business traveler," said Bob Harrell of New York-based travel and aviation consulting firm Harrell Associates. "It's going to be the poor schmo, the vacation traveler, who ends up paying these fees."
American Airlines also said it is raising fees for a number of other services, including those to transport pets and check oversized luggage. The airline last month agreed to join other major carriers in charging US$25 for a second checked bag.
That means a family of four, with each member checking two bags, must now spend an additional US$320 just to get their luggage to and from a destination.
With American Airlines leading the way among the major carriers, other airlines will be tempted to impose baggage charges, too.
"We are actually seriously studying it," said Robin Urbanski, a spokeswoman for United Airlines, the second-biggest US carrier.
With energy prices climbing, "all options for reducing costs and generating revenues are on the table," said Tad Hutcheson, vice president of marketing and sales for AirTran Airways.
"As bags add weight to the aircraft and burn more fuel, it may get to the point ... where checking bags is unbundled from the air fare."
(Shanghai Daily May 25, 2008)