Quicker Than The Eye

There was a story on the MSN Money site this week talking about how American Airlines is going to start charging $15 per checked bag for all of their flights, in an effort to bring in more money and cope with fuel costs. Keep in mind, that's not $15 for a second bag, or for an overweight bag, or anything like that. It's going to be $15 for your FIRST checked bag of less than 50 pounds; additional bags and heavier ones will be more than that. As a result, I would expect to see even more people using duct tape to make handles for refrigerator boxes and then trying to carry them onto airplanes; I would also expect to see more bags being pulled out of the cabin and sent down to the baggage compartment (at $15 a pop, plus additional handling charges or whatever). And there's no telling how much they're going to charge for golf clubs, skis, or other special baggage...

Sounds horrible, doesn't it? Well, actually, there are already a number of airline fees that are far more objectionable, and you're probably already paying most of them. Take booking fees, for example: anytime you buy an airline ticket anywhere other than the airline's own website, they're probably going to add $5 to $25; even ordering tickets over the telephone has a charge associated with it. Airport improvement fees, transit taxes, arrival fees and the like are unavoidable (it's how many local governments pay to upgrade and maintain their airports), and fuel surcharges have been applied to all tickets every summer for years now -- although the rise from $4 or $5 to $70 for rising fuel costs is making summer travel a lot less popular this year.

Some of these fees can be avoided. Changing a ticket when you've purchased one of those "Restricted" tickets, for example, will already run you another $25 to $75 (potentially more than the ticket itself), but you can avoid this by being very certain of your travel plans. Paper tickets are now often a $50 or $75 surcharge (plus extra to have them printed and delivered), but most of us use e-tickets anyway. In-flight meals that you have to pay for can be annoying, but I have been bringing my own food on airlines for years now anyway (ever since I was on a long flight and the only food offered was full of things to which I'm allergic). Probably the worst of the lot are surcharges added when using frequent flyer miles to upgrade your ticket -- it's still going to be cheaper than buying the first class ticked out of pocket, but unless you set these up well in advance you might have to pay an extra $300 for that "free" upgrade.

Given all of these additional fees, you almost have to wonder if the checked baggage surcharge is actually intended to cover rising fuel costs, especially considering that most airlines already have a fuel surcharge to make good that difference. Given the amount of outcry being raised over this new fee, and the amount of media coverage it's drawing, I could almost believe that the whole point of the exercise is to draw attention away from the more annoying and egregious fees being charged for previously free services like picking your seat, checking in a curbside, or using a paper ticket. Like trying to follow the ball in the old "cups and balls" trick; the hand is quicker than the eye...

So what can be done about it? In the long run, charging $100 in fare and $300 in fees is not going to be any more popular with customers than charging $400 in the first place. Eventually, the airlines that offer the best value to the customer (not necessarily the lowest fares or the fewest fees) will achieve dominant market positions, and if the companies that do this are also intelligently run, they should also become the most profitable (and therefore successful) companies in the industry. The airlines that continue to raise prices and fees while not providing value will go the way of TWA, Pan-Am, and Western Airlines, and no one will miss them, either...