Baggage Fees Weigh Down American Airlines

Southwest Airlines has stuck to its guns, refusing to charge customers fees for checking bags. I’m amused by the subtlety of the dig they take at other air carriers with their “Grab Your Bag. It’s On” campaign.

But are they leaving money on the table, money that passengers have shown they’re  willing to pay? In September the airlines reported a 275% growth in revenue from bag fees in the second quarter this year compared to last year. That’s hundreds of millions of dollars more.

But Portfolio.com looked deeper and found that the two major airlines that don’t charge baggage fees — including Southwest — actually performed better revenue-wise than did those that charged fees. Look how they compare to Dallas-Fort Worth’s other big dog:

American Airlines, for example, generated an industry-leading $118.4 million in bag fees during the second quarter, a 219 percent year-over-year jump, says the BTS. Yet its total revenue in the second quarter dropped 20.9 percent to $4.88 billion from $6.17 billion in 2008′s second quarter …

Just as in the first quarter, the only carriers to keep their second-quarter revenue declines in single digits were the two airlines that still permit free checked bags. Southwest was down 8.8 percent

So you tell me: Have passengers “accepted” these fees?

25 comments on “Baggage Fees Weigh Down American Airlines

  1. Bag fees are great. Why should I, if I am carrying one bag, subsidy the ticket of someone who is carrying four bags?

    Actually Southwest was onto something by charging overweight passengers twice.

    Weight affects the fuel efficiency of a plane. The more weight on it the more fuel it must consume.

    Yes, I am going there, tickets should be weighted on a passenger’s total weight, luggage included.

  2. @Enrique, I 100% agree. There should be a boxing style weigh in when checking in for a flight.

  3. And there you have it. The beancounters can only see a 118.4 M profit and places it in the profit margin. They could probably start charging for on board toilets and make a ‘profit’ too, but how can they add up or track ‘loss’ if the potential customer never makes a reservation on that airline based on its nickel and diming policies. Everyone should be able to carry 1 bag under 55 lbs. w/o charge and one carry-on that fits under the chair.

  4. Beancounters?

    I am just trying to save myself money. If it happens to make airlines more profitable and less inclined to ask for a government bailout, it’s a win-win.

  5. I greatly admire Southwest Airlines for their stance on this issue. They have become our primary airline for flights.

  6. I am so excited that I moved out of DFW and am no longer locked in to AA to get anywhere. While I did appreciate the convenience of direct flights, I didn’t care for being ripped off on the price of every ticket PLUS paying for my bags.

  7. In the past year – since the baggage fees at AA were enacted – I’ve flown both AA and Southwest.
    Checked bag fees actually – in just observing – make things really inefficient when it comes to boarding. People that might’ve checked one of their bags without the fee carry them on now, and then proceed to hold up the line while they shove a suitcase in the overhead bin.
    A couple of years ago, when I’d fly, I’d check my suitcase, and carry a laptop bag and my purse on. Those take up considerably less room. I can still do that if I fly Southwest (which I do, pretty much exclusively now), but if I have to take AA, the packing scheme changes considerably.
    And I can’t imagine flying AA if you had kids. All those bags? You’d probably pay an entire extra ticket’s worth of checked bag fees, at least.

  8. I think it’s caused many casual fliers (like me) to lean toward Southwest, but most frequent fliers have (much like drivers and rising gas prices) made adjustments in their business and personal budgets to keep traveling.

  9. Uh Oh. Southwest’s PR division has asked friends and family to comment.

  10. I fly Southwest now whenever practical (i.e., I won’t make 3 stops to get to where I am going). If I fly AA, I never check my bag. As for inefficiency in boarding and deplaning, I agree — when I travel with my family (wife and three kids), we each end up with our carry-on and one “personal” bag, all of which has to be stuck someplace and slows everyone down. My wife still has to check a bag (God bless women), but almost everything else is with us on the plane instead of being stowed below.

  11. @ Enrique

    I am neither a friend nor a family member of Southwest Airlines. And if they could flew non-stop out of Dallas to more locations, I would only use them exclusively. They are my P1 of airlines, so to speak.

  12. Southwest out of Love Field with no baggage fees vs AA out of DFW with baggage fees?

    Closer + cheaper + less hassle = no brainer.

  13. Well, technically I meant that I have a extreme preference and I almost exclusively only fly Southwest when at all possible. Didn’t mean it as a Ticket reference, per se. Also, it’s Friday.

  14. Amanda, I thought you meant that the anus was on AA to try to convince you to fly them instead of Southwest!

  15. AAs fees are ridiculous. We were recently bumped from a flight since it was oversold but got vouchers for future travel. However you can’t redeem the vouchers online – you have to go to the ticket desk at the airport to redeem and if that wasn’t bad enough – they charge you $30 PER TICKET for using the ticket counter to get your ticket – even though there isn’t an option to purchase online. So folks – next time you are offered a voucher to accommodate AA – be sure to ask for that additional money it will cost you to redeem the voucher.

  16. If you asked me this question a year ago, before I had my first child, my answer could have gone either way. Now that I am lugging luggage for both myself and my son, the baggage fees frustrate me.

    Ticket prices are the same for everyone, but not everyone has the same ability to carryon their luggage. It’s tough to do when I also have to account for my son’s stuff — and my son himself, occupying one of my free arms.

    At least I haven’t (yet) been charged for him riding in my lap, although it’s also weighing down the plane. Guess that means my fellow passengers are subsidizing his 17-pound butt. :)

  17. I don’t accept it but the airline puts people in a no win situation. I just flew to NYC this past weekend and took AA nonstop. When we were checking our 1 bag, we saw people on the floor taking things out of bags to put in carry on’s because the bag was over 50 lbs. Then we were held up at the gate by the airline employees telling people their carry-on’s were too big and they would need to check them. This caused all kinds of commotion. And then getting on the plane, we not only had to wait while people stuffed their bags in any place they could, we had to deal with the flight attendants telling everyone to hurry it up so we could leave. It was such a beating. The airline has probably made the carry on requirements smaller so they can charge people. And FYI-AA’s fees have already gone up from $15 to $20 for one bag. 2nd bag is now $30. The greed amazes me. Guess I’ll start saving my baggage fee money now if I ever want to go to Europe.