Airlines tacked on $22B in fee revenue in '10
Those charges for baggage, seat upgrades and bags of pretzels added up to $22 billion in revenue for U.S. airlines in 2010.
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Since: May 08
#1 May 31, 2011
It used to simply be included in the fares. Since some of the "low cost carriers" didn't offer meals you the flier were offered one on the legacy carriers, and complained and joked about the quality. Now everyone charges the same fares and offers the same services. The ala carte system allows you to pay more if you want to take advantage of the options. SW doesn't charge for bags, loss of revenue for them.(they are one of the few that succeed without it) I can tell you from load factors out of SAN paying for the bag hasn't hurt AA where SW has a big presence. Fees are a source of revenue, and are here to stay making this story hardly newsworthy.
#2 May 31, 2011
The big advantage of having fees instead of just tacking on the additional cost to the price of the ticket is that the fee is NOT taxed while the higher ticket price would be taxed in full and the airline would keep less.
On the downside, the additional baggage fees encourage people to drag their steamer trunks and kitchen sinks onto the aircraft and try to jam everything in the overheads. Longer boarding process, longer de-planeing times etc.
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