Could Baggage Surcharge Strategy Be Hurting The Airlines?

An airline’s choice to nickel and dime its customers through baggage charges seems to correlate with revenue decline.

Editorial, Travel /

14 October 2009

 

airline-bag-charges-and-revenue-decline-export

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The domestic U.S. airline industry has taken alarming steps over the past few years to cut costs and find new revenue streams. Consequently, what used to be free now often incurs a cost above and beyond whatever fees a passenger may have paid for their ticket.

Case in point, baggage. United Airlines was the first to charge passengers to stow their luggage away back in February of 2008. A rather innocuous $15 surcharge for a second bag. Since that time, airlines have shuffled and scooted their baggage fees around in an attempt to find a sweet spot between revenue and keeping the frothing hordes of angry travelers at bay. United in particular has gone so far as to charge $50 to pack away a second piece of luggage on their flights.

What the info visualization above points to; however, is that this strategy of attempting to gain revenue through baggage surcharges is indicative of airlines that are loosing the most money. Could this be due to unfavorable sentiments in the market place? Or maybe this the zealous baggage charges are in response to a more dire economic situation?

Whatever the causation – I like the fact that the airlines that charge the least for baggage seem to be fairing the best in the marketplace.

Original data source: http://joe.biztravelife.com/09/042309.html

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