Airlines Bag Fees Drop Significantly Over Last Two Years

Airlines’ bag fees have dropped significantly over the last two years and are generating less revenue than they were for airline companies. On Monday the government reported that in 2013 US airlines raised $3.35 billion from bag fees, representing a four percent drop from the previous year.

Air passengers have grown wise over the years, and know how to avoid paying airlines’ bag fees, – which can reach as high as $25 for domestic flights – by using airline credit cards, or opting to take a carry-on bag on board instead of checking a suitcase in.

The government figures, released by the U.S. Department of Transportation, said that airlines earned $7.3 billion in the fourth quarter of last year, reversing a $188 million loss for the same period in 2012.

A former American Airlines executive, Robert Mann, said the airlines’ bag fees revenues have dropped due to the type of passengers who travel:

“You have more people exempt (from the fee) because they use the right credit card or they get status in the airline’s loyalty program. The passenger who gets whacked by the bag fee is the infrequent flier,” he said.

At the top of the pack for bag fees is Delta airlines, which raised a massive $833 million in fees from luggage last year. Next in line was United with $625 million, followed closely by US Airways at $528 million.

As airlines’ bag fees dwindle, the companies are looking for increasingly inventive ways to generate revenue in order to make up for the decrease. Delta is in the business of what they call “merchandising”, essentially charging fees for priority boarding, economy seats and upselling to first-class.

Lou Guyton of Mansfield, Texas, who works for a national animal-protection group, said she always checks her bags in when she flies: “I really don’t like to go through security, where you have to take out all your stuff, and then you have to try to find overhead bin space,” she said.

Jim Weck, a telecommunications company program manager from Atlanta, also thinks it’s high time airlines gave their customers a break when it comes to charging extra fees: “We helped you in your hour of need; now it’s time to give back. No matter what industry you’re in, people don’t like being nickel-and-dimed,” Weck said.