Top airline companies made billions of dollars last year on those pesky baggage fees travelers despise so much.
The top 20 global airlines raked in $33.3 billion in revenue from a combination of fees for carry-on bags, price hikes for checked luggage and fines for overweight suitcases, a new report found.
The dollar figure rose 15% from $29 billion in 2022 and accounts for roughly 4.1% of global airline revenue in 2023, according to the study by airline consulting firm IdeaWorksCompany and car rental service CarTrawler.
The revenue stream comes directly from airline customers through three primary means — fees for checked baggage in the aircraft hold, larger carry-on bags and overweight or extra large bags, the analysis states.
Long gone are the days when a plane ticket included a free checked bag or even a free carry-on in some cases. Some low-end tickets now only include a free personal item — such as a purse or small backpack.
Most airlines have begun charging for checked and/or carry-on items for “basic economy” ticketholders which pay the cheapest rate available.
The exception is in Asia where airlines like Air China, Korean Air and Qantas still include baggage with a ticket purchase, no matter the fare or distance.
Airline companies first rolled out baggage fees as “an economic necessity” during the oil shock of 2007 and 2008 which saw a dramatic uptick in fuel prices, according to the study.
Within months, major US companies switched from including two checked bags with every ticket to charging for the first checked bag.
From there, the fee amounts and their prevalence have steeply increased over the years.
Just this month, JetBlue — which was not included in the analysis — sparked outrage after quietly hiking its prices for checked bags, with teed-off passengers calling the sneaky move a greedy cash grab.
The New York-based airline is now charging travelers $45 for their first standard-size bag checked within 24 hours of departure — and $60 for a second bag. If checked more than a day out, the cost for each is $10 cheaper.
Instead of making a large public announcement of the change, the airline quietly updated the “Bag Info” section on its website where fine print says that the price increase was implemented on Feb. 1.
That only angered customers more who took their frustrations to social media.
“Inflation and greed rising,” one named Yau wrote on X.
The study included four American airline companies among the mix of top global airlines that did not include any budget carriers.
The baggage fees are just part of the $118 billion in so-called “junk fees,” or ancillary fees, the airline companies made in 2023.
Seat selection fees, which have become increasingly more frequent over the last few years, also represents a large portion of the revenue stream.
The Biden administration has vowed to crack down on the “junk fees” in an effort to provide travelers with more transparent prices when they go to book flights.
“The Department of Transportation is taking action on airline junk fees that inflate prices for American families,” a DOT spokesperson told The Post in November.
“For example, we are working to ban family seating junk fees because parents shouldn’t have to pay more just to sit with their kids when they fly.”
In 2022, US travelers forked over $6.8 billion in baggage fees, according to the Department of Transportation.
Just two years earlier, American taxpayers’ money was used to provide a $54 billion lifeline to major US airlines as they suffered a massive blowout from COVID-19 travel bans and restrictions.
Credit: Source link
