American Airlines Increases Transatlantic Checked Bag Fees

American Airlines has increased transatlantic checked baggage fees. The higher fees only apply to basic economy tickets on…

American Airlines Increases Transatlantic Checked Bag Fees

American Airlines has increased transatlantic checked baggage fees. The higher fees only apply to basic economy tickets on or after April 21st. This move does make some sense for the airline. Here is why.

American Airlines is increasing transatlantic checked bag fees. Photo: Getty Images

Raising checked baggage fees

AwardWallet reported the increased fees. Initially, baggage fees cost $60 one-way. Now, that number is up to $75. This means that, on a roundtrip, baggage costs go up from $120 to $150. The price for a second bag remains at $100, while the third and fourth bags also stay at $200 each one-way for transatlantic travel. American claims that this move is designed to “better align” with transatlantic business partners like British Airways, Iberia, and Finnair. These airlines are also members of the world alliance.

Getty American Airlines oneworld
The airline is indicating that this move is designed to aline with fellow transatlantic oneworld partners. Photo: Getty Images

However, unlike other carriers in the US, American has kept checked baggage fees for domestic flights at $30 for the first bag. Transpacific flights still do not have a basic economy fare available for booking. On long-haul flights, Main Cabin fares come with a standard baggage allowance. See this link for American’s full baggage allowance and fees.

What this means for travelers

For passengers, this means shelling out more money for baggage on basic economy fares. Though unfortunate, there is a bigger scheme unfolding here. Transatlantic basic economy fares are much lower than they were at the same time last year. These low fares are available on many routes across Europe from cities around the United States.

American Airlines reduces international capacity with 10% due to coronavirus
Fares are at some of their lowest points in recent memory. Photo: Getty Images

With fares in the low $300s-$400s from major cities, American is not making the profits it once used to. Raising checked baggage fees is a way for the airline to recover some of that money without having to raise fares compared to customers. Most passengers likely will book tickets based on the fare and not on ancillary fees. Through this, American can still appear competitive and drive additional customers towards the airline.

American Airlines getty images
Main cabin fares come with checked baggage allowance. Photo: Getty Images

Basic economy fares are the most restrictive in the industry. Passengers receive no free checked bags to any destination. However, personal items and carry-on bags are still allowed on the ticket. And, on American, passengers can pay a fee to choose their seats at the time of booking. Or else, those seats will be assigned at check-in. When it comes time for boarding, transatlantic basic economy passengers are assigned to Group 8 boarding at the end of the process.

AMerican Airlines 767
Basic economy fares come with carry-on baggage. Photo: Getty Images

The optics of this, however, are not very good. American is receiving government aid to survive in the current aviation climate. And then, the airline goes out and raises checked bag fees. However, the two are not exactly comparable. Most passengers who pay for baggage will end up doing so at check-in or else at the airport. Which means American would not get those funds until later in the year given the current stagnation in travel.

American Airlines Los Angeles
The airline will also receive government aid. Photo: Getty Images

That being said, if this were a temporary move, it could perhaps be a bit more excusable. But, American will likely retain these checked baggage fees for the future when travel does rebound. At that time, coughing up these extra fees would hurt– especially if the carrier is reporting similar financials as it was in 2019.

What do you think about American’s new checked bag fees? Let us know in the comments!

Source : Simple Flying More   

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IATA Head Says Social Distancing Will End Cheap Travel

The Director General of the International Air Transport Association (IATA), Alexandre de Juniac, believes that social distancing will…

IATA Head Says Social Distancing Will End Cheap Travel

The Director General of the International Air Transport Association (IATA), Alexandre de Juniac, believes that social distancing will end cheap travel according to statements made at a briefing on April 21st. His rationale is that with fewer seats available, it means that airlines will have to increase prices to turn a profit.

Low-cost carriers may have to increase fares amid social distancing. Photo: Getty Images

Statements from Alexandre de Juniac

According to Flightglobal, IATA Director General de Juniac ran through his rationale as following. First, following the guidelines of social distancing, airlines are starting to block middle seats to give passengers more room. Take a traditional 737 or A320 with a six-abreast, 3-3 configuration. Blocking middle seats means two out of every six seats in a row are unavailable for sale. Or, one-third of the aircraft.

Delta Main Cbain
Airlines like Delta are blocking middle seats on aircraft. Photo: Jay Singh – Simple Flying

According to de Juniac, break-even on short-haul flights require occupancy of about 70% or more. Cutting 33% of an aircraft’s capacity puts airlines under that break-even point. With traditional prices, that would have airlines operating at a loss. While full-service carriers can lean slightly on premium customers from long-haul flights, low-cost carriers will face the brunt of this.

Spirit airlines A321
Low-cost carriers cannot rely on corporate contracts for lucrative premium cabin long-haul travel. Photo: Getty Images

This is because low-cost carriers will have to increase their prices to sustain the reduced capacity. de Juniac theorizes a 50% increase in tickets for airlines to turn a “minimum profit.” Which, for passengers, means higher fares even onboard low-cost carriers.

How could low-cost carriers respond?

Raising fares would largely go against the entire idea behind low-cost carriers. In addition, it could lead to many people being shut out from travel due to the economic consequences of the coronavirus pandemic.

easyjet ryanair
Ryanair and easyJet have taken different stances on social distancing. Photo: Getty Images

Some low-cost carriers are taking different stances. EasyJet has announced that it would block out middle seats when flights resume. Meanwhile, Ryanair’s boss has branded social distancing as “nonsense.”

Social distancing on a plane is hard. On a low-cost carrier, the cabin configuration is dense, and blocking middle seats does not come anything to close to guidance stating people should keep two meters (six feet) of distance between them.

Another issue here is that this is mostly uncharted territory for airlines. There is no playbook for airlines to react to a pandemic that has brought new terms like social distancing into the vernacular. This leaves airlines a little short on options. One reality could be for low-cost carriers to reject the idea of social distancing and keep operating like normal. This move would primarily be one to keep fares low and the decision of whether to travel or not in the hands of passengers, although some passengers may end up on a full flight.

Airasia
This is largely uncharted territory for airlines. Photo: Getty Images

One factor in this, however, could be the guidance of local health agencies. Many are still advocating for social distancing. But, if they mandate it on a flight, airlines may have to take measures to comply and, thus, likely increase fares or ancillary fees (or both).

Overall

Most low-cost carriers will likely try to stick as close to normal operations as possible in order to maintain low fares. Perhaps, passengers could pay extra to have an empty seat next to them. This may change, however, if governments and passengers continue to push for social distancing and force airlines to respond in kind. But, Director General of the IATA, Alexandre de Juniac, has laid out his view on how social distancing will impact fares.

Do you think de Juniac is right? Let us know in the comments!

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