Airlines made $6 billion in baggage/change fees in 2013 (1 Viewer)

[Doctor Detroit]

Congrats?

GB Southwest.

WASHINGTON — Are those airline baggage and cancellation fees taking a bite out of your wallet?

They’re certainly making money for U.S. airlines, which collected $6.16 billion last year: $3.35 billion in baggage fees and $2.81 billion in reservation change fees, according to U.S. Department of Transportation data released Monday. That’s a slight increase from $6.04 billion collected in 2012.

Those ancillary fees helped the 26 passenger U.S. airlines make a net profit of $12.7 billion in 2013, up from a profit of $98 million in 2012.

Delta Air Lines topped the list, collecting $1.67 billion last year: $840 million in reservation change/cancellation fees and $833 million in baggage fees. United Airlines came in second place, with $1.38 billion in fees: $756 million in reservation cancellation/change fees and nearly $625 million in baggage fees.

The new airline created by the merger of American Airlines and U.S. Airways, which are still reporting their data separately, would have topped the list if their fees were added together. The combined airline collected more than $1 billion in baggage fees and $848 million in reservation cancellation and change fees.

Reporting as two airlines, American ranked third in the reservation cancellation and change fee category, collecting $521 million in fees, while US Airways came in fourth place with $327 million. U.S. Airways was third for baggage fees with $528 million, while American collected $506 million to come in fourth.

American was the first U.S. airline to charge customers to check bags in June 2008, for a fee of $15. That year, American collected $277,991 in baggage fees, according to Department of Transportation data. Other U.S. airlines quickly followed suit, and as a group they collected $1.1 million that year.

Fees have since crept up; American now charges $25 for the first checked bag, with some exceptions.

http://kdvr.com/2014/05/05/airlines-make-billions-on-added-baggage-and-flight-change-fees/

 

[Keerock]

That explains it.. LHUCKS must take 20 bags with him when he flies to Detroit.

 

[Doctor Detroit]

That explains it.. LHUCKS must take 20 bags with him when he flies to Detroit.

 

[coyote5]

3.35 billion <> 6 billion

 

[Doctor Detroit]

3.35 billion <> 6 billion

They made $2.5 billion in change fees as well according to CNN.

 

[jon_mx]

I believe they will start cracking down on carry-on rules and start charging for the gate checked bags. It is too much of a profit center for the airlines to pass up.

 

[Dan Lambskin]

Hooray shareholders!

 

[coyote5]

Missed that part.

 

[17seconds]

I like the model. Base airfare is as competitive as ever because of the internet so the airlines make up for it by charging more for people who overpack or plan badly and show up with overweight luggage. Keeps my costs down.

 

[Doctor Detroit]

Missed that part.

It wasn't in the link, heard it on the TV

ETA: better link added in OP with all data

 

[jon_mx]

If I go on a week long trip, I wear 7 layers of clothing.

 

[Doctor Detroit]

Wait until the Cliven Bundy people learn of this.

 

[KCitons]

If I go on a week long trip, I wear 7 layers of clothing.

I just vacation at nudist colonies.

 

[mquinnjr]

I believe they will start cracking down on carry-on rules and start charging for the gate checked bags. It is too much of a profit center for the airlines to pass up.

Spirit Air already does this, only a matter of time before the other carriers follow suit.

 

[jon_mx]

Should be a great business opportunity for someone to come up with vacumm packed luggage which will shrink to a convient carry-on size which will fit under the seat.

 

[lod01]

I believe they will start cracking down on carry-on rules and start charging for the gate checked bags. It is too much of a profit center for the airlines to pass up.

Spirit Air already does this, only a matter of time before the other carriers follow suit.

I always wondered how they would be able to do that and not slow boarding to a crawl. I see tons of bags that would never fit in the little rack that they have sitting next to the gate.

 

[mquinnjr]

I believe they will start cracking down on carry-on rules and start charging for the gate checked bags. It is too much of a profit center for the airlines to pass up.

Spirit Air already does this, only a matter of time before the other carriers follow suit.

I always wondered how they would be able to do that and not slow boarding to a crawl. I see tons of bags that would never fit in the little rack that they have sitting next to the gate.

They tell you up front, if you don't pre-pay for carry-on luggage that you're effectively going to get doored on fees at the airport. So, they control the chaos by spelling this out extremely clearly when you buy your ticket so that it's controlled during boarding. Just need to price in on your own to see if they're still a better deal vs. other airline options.

After I did a round trip flight through them to Vegas from Newark, I was kind of surprised other airlines aren't doing this just based upon how relatively smoothly it was executed.

 

[Baloney Sandwich]

I believe they will start cracking down on carry-on rules and start charging for the gate checked bags. It is too much of a profit center for the airlines to pass up.

I think they will go a step further and start charging for carry on baggage.

 

[Long Ball Larry]

I like the model. Base airfare is as competitive as ever because of the internet so the airlines make up for it by charging more for people who overpack or plan badly and show up with overweight luggage. Keeps my costs down.

exactly.

if they were averaging < $4 mill in profits per year, that is a problem for them. They have a way to increase profits that is not mandatory for all customers and gives customers options in terms of what they want to pay.

 

[jon_mx]

Should be a great business opportunity for someone to come up with vacumm packed luggage which will shrink to a convient carry-on size which will fit under the seat.

Seems like Eagle Creek has beat me to the design idea. The have some really nice products which will help compress your luggage to reduce the size so that it will fit into carryon luggage.

 

[17seconds]

Should be a great business opportunity for someone to come up with vacumm packed luggage which will shrink to a convient carry-on size which will fit under the seat.

Seems like Eagle Creek has beat me to the design idea. The have some really nice products which will help compress your luggage to reduce the size so that it will fit into carryon luggage.

if only I had some of them to compare

 

[jonessed]

I would rather see them put the cost into the actual tickets, but those without kids or those making short trips probably benefit quite a bit from this model.

 

[St. Louis Bob]

Can't wait for the next tax payer bailout.

 

[Doctor Detroit]

Should be a great business opportunity for someone to come up with vacumm packed luggage which will shrink to a convient carry-on size which will fit under the seat.

Seems like Eagle Creek has beat me to the design idea. The have some really nice products which will help compress your luggage to reduce the size so that it will fit into carryon luggage.

if only I had some of them to compare