Genius in the Air

There are times when you just have to stand in awe of the sheer genius being displayed before you; when you realize that you are in the presence of greatness. I’ve seen Nolan Ryan’s fastball, Michael Jordan’s floating layup and Wilt Chamberlain driving to the hoop with my own eyes; I’ve heard Bruce Hornsby, Joe Walsh, Steve Howe, Yo-yo Ma, Itzhak Perlman and Billy Joel play in person; I’ve even spoken with at least one of the gods of my own discipline (it depends on how you define “gods” and how you define my discipline). But nothing could have prepared me for the latest development in the airline industry: United Airlines is now charging passengers a fee to pay a fee…

In a story which broke over the weekend, the Associated Press online is reported that United Airlines is now charging passengers a $5 service fee if they want to pay the (already preposterous) $15 checked bag fee at the time they arrive to check in for the flight. The airline explains that if you pay the checked bag fee in advance (either when you buy your ticket or at any point prior to showing up at the airport) there’s no extra charge; they’re calling this an “online discount.” To someone who was not sure if they’d be checking bags at the time they bought the ticket, however, the upshot is a $5 fee which they are charging you to pay them a fee for something that was included in the price of your ticket just two years ago…

Of course, the same article points out that United is still way behind some of the other airlines. Ryan Air, for example, is charging its passengers 5 Euros (about $7 US) to check in online, and twice that to do so in person at the airport. AirTran charges extra (up to $20 extra) for “good” seat reservations, like exit row and bulkhead seats, and one of the Spanish airlines is charging a fee for ANY reserved seat – and if you are willing to go to 30 Euros extra ($42 US) they’ll sell you an aisle seat and guarantee that the middle seat next to you stays empty. And there is already talk of fees for carry-on luggage, since more and more travelers are avoiding the checked bag fee by just packing larger and larger bags into the overhead compartments…

So far the market resistance to these increases has been hard to distinguish from the mass of other negative economic news that has been affecting the American economy, but it is worth noting that travel of all kinds is dramatically lower than it had been, and as air travel becomes more expensive and less enjoyable people are apparently looking for other ways to get where they are going, or just not travelling unless they absolutely have to. As a side effect, alternate transportation projects (high-speed passenger rail, for example) are finally starting to draw investor attention, and if an viable alternative to air travel does emerge over the next few years, the cycle of decline now hitting the airline industry could easily snowball. In which case, we have to question if fees on top of fees is really the optimal strategy…

Is it possible for the airlines to pull out of the tailspin they’ve gone into and start making a profit once again? It seems to me that providing a reliable service at a reasonable price while creating a minimal amount of discomfort and aggravation for your customers might work; it certainly has for Southwest Airlines and the handful of other companies that have tried it. But I wouldn’t really know. I’m not a genius, you see…