Hmmm…
I’m not sure whether to think “well, I guess they have time to implement changes now,” or “are they seriously raising checked bag fees at this time?!”
In this post:
American raises transatlantic checked bag fees
For tickets purchased as of today (April 21, 2020), American Airlines has raised checked bag fees for transatlantic basic economy passengers.
This applies to those checking bags between Europe, Israel, Morocco, and the US, Puerto Rico, US Virgin Islands, Canada, Mexico, the Caribbean, Central America, and South America.
Again, this is specific to those purchasing basic economy fares, which don’t come with a checked baggage allowance (or free seat assignments, upgrades, etc.). For those passengers, the cost of the first checked bag is increasing from $60 to $75.
An American Airlines spokesperson had the following to say:
“Starting today (Tuesday, April 21), American is changing its checked baggage fees for Basic Economy passengers on transatlantic flights to better align our bag fee structure with our Atlantic Joint Business partners, British Airways, Iberia, and Finnair. These changes only affect passengers who purchase new Basic Economy tickets on transatlantic flights starting on April 21 going forward.”
In fairness, we at least have to give credit to American for not raising domestic checked bag fees. Recently JetBlue and United announced that the fee for the first checked bag on domestic flights is increasing from $30 to $35 if not purchased in advance, and American hasn’t matched that yet. They continue to charge $30 for the first checked bag.
American is raising checked bag fees on transatlantic flights
Minor detail, and/or bad optics?
Ultimately raising checked bag fees only on basic economy fares for transatlantic flights isn’t the worst airline checked bag fee hike we’ve seen. However, I can’t help but feel like the optics here are bad.
I’m going to assume that this is something that they had planned on doing long before they started this, but:
- There’s very little demand for travel right now, and airlines aren’t exactly in the driver’s seat when it comes to pricing
- Airlines have just received billions of dollars in government aid
- Did I mention that airlines received billions of dollars in government aid?
Is this really the time to be raising fees?
Bottom line
American has raised the cost of checked bags on transatlantic basic economy tickets from $60 to $75. This just seems like a very strange time to be raising checked bag fees, even if it was previously planned…
Where do you stand on this — a minor change that’s fine to make, or does this create the wrong impression at this time?
How come they do not sell basic economy on Asia flights?
@James S... Do the numbers and break it down. Thats $150 one way overseas. How much would you driving your car the same distance, say... across the US from NY to LA? Not having the option to sleep and also assuming you would need hotel accommodation for a few nights if you drove straight. Sounds like a lot more than $150 to get you there one way. You sound like the type that always looks...
@James S... Do the numbers and break it down. Thats $150 one way overseas. How much would you driving your car the same distance, say... across the US from NY to LA? Not having the option to sleep and also assuming you would need hotel accommodation for a few nights if you drove straight. Sounds like a lot more than $150 to get you there one way. You sound like the type that always looks for those basic economy fares and wants first class treatment. Sorry, life doesn't work that way. Maybe you can hop on SW or Spirit across the pond.. oh wait, they dont fly those routes because they wouldn't be able to give you the fare you would want...
You wish to attract passengers at a time like this, not turn them away.
Doug Parker and his low end management team all need to be fired!
I say really bad timing and they could have waited until economic conditions improved! Really poor!
And the award for worst timing ever goes to.......... this fully exhibits how little they appreciate and think of the American people who just bailed them out AGAIN You can be certain that they never even entertained the thought of reducing/removing the bonuses for CEOs or even (god forbid) pay cuts for them or even less dividends for shareholders - there was a time when we never had to pay anything to check bags. They...
And the award for worst timing ever goes to.......... this fully exhibits how little they appreciate and think of the American people who just bailed them out AGAIN You can be certain that they never even entertained the thought of reducing/removing the bonuses for CEOs or even (god forbid) pay cuts for them or even less dividends for shareholders - there was a time when we never had to pay anything to check bags. They implemented those charges when we had a supposed fuel shortage & prices were very high, now oil is at an all time low so the airlines will save a fortune on it - how on earth can they justify sticking it to the average traveler? Thankfully, I am already not a fan of theirs so book with my preferred airlines unless they are the only option. I am sure these fees will also not be charged to the first class or business class customer. People should fly any other airline if they can to show them what we think of their greed
@Cassandra:
I find your reaction interesting: You are talking about job losses on the one hand and an increase of the TATL bag fee from USD60 to USD75 on the other hand.
Most people who lost their job are probably not planning a vacation to Europe at the moment. And if so, they really need to recalculate their entire planning whether or not an icrease of USD15 per direction blows their overall travel...
@Cassandra:
I find your reaction interesting: You are talking about job losses on the one hand and an increase of the TATL bag fee from USD60 to USD75 on the other hand.
Most people who lost their job are probably not planning a vacation to Europe at the moment. And if so, they really need to recalculate their entire planning whether or not an icrease of USD15 per direction blows their overall travel budget.
What I would like to know:
- How much profit is an airline allowed to make before they are considered greedy?
- How cheap can a ticket price be, before you consider a passenger stingy?
- Should AA give discounts for unemployed passengers? Should there be surcharges for wealthier passengers?
Just as a reminder: We are talking about the basic economy fare here. The whole point of this discounted fare is to travel without luggage (and market segmentation).
AA. No service, no seat room, no surprises.
I feel this is so insensitive of AA. Such greed, in a time when people are loosing their jobs, businesses and lives.
Maybe they hope, once people start flying again, that everyone has forgotten what the old price before the crisis was?
@Jordyn
You have to go to their website to request the refund. If AA cancelled, yes you are eligibility for the refund, however it’s not automatically refunded.
Just a note to everyone, today you’re mad at the airlines, tomorrow your cellular carrier, next week your cable company and so on.
I know you’re venting...
Please volunteer, read a book, play with your kids, be kind to each other and pray!!
Will everyone just stop flying on this terrible terrible airline and just let them die already. The planes are the oldest of any airline, they are always delayed, and the customer service isn't just bad it's offensive. Come on people, the next time you fly, literally, any other airline would be a better a choice.
I look at this as a potential positive move... this is only for basic economy which is usually more or less 100 or so cheaper than regular economy. This could be AA's way of moving the pricing point of a bad product, ie basic economy, to the point that it makes more economic sense to go with regular economy. Or----- yes AA is doing what AA does best... get themselves press time whether it be negative or positive and damn the consequences.
I am continually disappointed in the corporations in the United States, their insane obsession with quarterly earnings at the expense of the long term health of the company.... they leverage everything to the limit and when the inevitable rainy day comes, they run to the FEDS... time for the hand outs to stop... we are broke and the virus really broke us... thanks China.....
American Airlines is the worst..... i drive now and if i cant drive i zoom video...
Everything I see something like this, it hits me that American and everything I loved is just being swallowed up by US Airway's ridiculous concept of customer (No)care and policy "enhancement". Policies designed to kneecap frontline employees and make their job just as miserable as the passengers experience. All in the name of profit and making sure we realize 2015 AA is no more.
LET AMERICAN AIRLINES FAIL. Its a garbage airline anyway that has no regard for customers
Extinction is tough.
Still waiting on my refund that AA is supposed to give me after THEY cancelled the flight. Isn't it mandated by the government? (Bought my tickets months ago). This was the 1st time ever booking with AA and now I remember why I never have before. Ugh. Disgusted with all airlines right now tbh. Them especially.
Their joint venture OW partners already charge this, so really, *not a big deal*. Don't think that many people were running to choose American metal over European OW counterparts for the 15$ difference in checked bag so this is negligible.
Also as so many have mentioned, with transatlantic fares routinely under 400 USD R/T, does this really come as a surprise to anyone?
Either pack light or factor it in to the already...
Their joint venture OW partners already charge this, so really, *not a big deal*. Don't think that many people were running to choose American metal over European OW counterparts for the 15$ difference in checked bag so this is negligible.
Also as so many have mentioned, with transatlantic fares routinely under 400 USD R/T, does this really come as a surprise to anyone?
Either pack light or factor it in to the already low cost of travel.
Not to mention OW elite get additional bag allowance on *all fares*, including the basic econ fares.
@Luke Vader
Is this like someone wearing all their SCUBA gear so they didn't have to pack it and check a bag? Did that really happen or is that an urban legend? I honestly don't know anymore...
Benyamin,
Why are you inciting trouble for the shittiest airlines in the world. They have earned the right to be the most hated business in America, let them enjoy.
@Klaus
Apologies if I made you feel offended. Not my intentions at all. Just trying to get facts out.
Just to add more info.
AA does not hedge fuel and is not affected by fuel price hedge loss.
AF hedge 50-60% for then next 12 months a little less beyond 12 months. Unfortunately those % is off normal consumption not 80%+ drop in flights. So yes, you can believe them, but the...
@Klaus
Apologies if I made you feel offended. Not my intentions at all. Just trying to get facts out.
Just to add more info.
AA does not hedge fuel and is not affected by fuel price hedge loss.
AF hedge 50-60% for then next 12 months a little less beyond 12 months. Unfortunately those % is off normal consumption not 80%+ drop in flights. So yes, you can believe them, but the impact would be much less in the next quarter after this loss hits the statements.
I agree AA should not sneak this in, but this is probably the best time for AA to do it.
Who flies AA to EU anyway? If you live on the East Coast there are way cheaper flights on European carriers out of major airports with $30-$35 checked bags or Economy+ with bags and seat choice included. I don't even fly AA domestically unless it's for business and the company pays.
Actually, it's a sound strategy. It's like making a big government announcement on a Friday night before a long weekend to miss the news cycle. These blogs will light up, but the average traveler won't even know it was ever lower and the blowback will be minor because hardly anyone is traveling.
Obviously, it sucks for passengers and it's sneaky because it's hidden from view and not subject to federal tax. But hey it's American, pretty much of what they do sucks.
Why on earth should TSA screeners and others in the cabin exposed to people's baggage? AA is now in debt to the taxpayers of America, time for Congress to remove the second carry-on bag option and force them to offer free checked bags.
In time of COVID-19, baggage should not be carried onboard.
AA and its blood sucking unions need to go under without the help of our taxpayer money. Other companies will rise and make it work.
The timing is in poor form. Now that the US has ownership interest in the airline, I would hope they would be more humble at this time with their nickeling their new owners. Not the amount of the $, which is really not that much, it just is bad press.
Well, that does it for me.
I'm going to exercise my consumer right, and NOT travel internationally with AA again.
As for domestic travel, I'll just wait and see....
If you want to make the most out of your tax dollars, take Amtrak for domestic travel. Besides, first two bags are free of charge.
For $75, just buy one of those cargo/utility jackets that has 20 pockets on the outside and inside. You'll save $75 (on the baggage fee) on your return flight, and still have the jacket when you get home.
If you don't want to pay $75 for your bag then don't buy a basic economy ticket people. Or fly with another carry. Jesus Christ some of you are lame.
@Eskimo:
Thanks for your answer – which seems a bit aggressive. Even though you might disagree that I am sort of defending AA, I would have preferred a less emotional and a more factual answer from your side. And yes, I do know why Brent isn`t negative.
As you are saying, buying future contracts isn`t the only way of hedging. And this underlines the point I was trying to make is: Just because...
@Eskimo:
Thanks for your answer – which seems a bit aggressive. Even though you might disagree that I am sort of defending AA, I would have preferred a less emotional and a more factual answer from your side. And yes, I do know why Brent isn`t negative.
As you are saying, buying future contracts isn`t the only way of hedging. And this underlines the point I was trying to make is: Just because fuel prices are down now, does not mean that AA actually bought the fuel at this low cost.
General consensus in this discussion seems to be: AA should not introduce any price increases at the moment because fuel is cheap and demand is down.
All I wanted to point out is that there is a chance that AA (and airlines in general) might still be flying with the expensive fuel that they bought weeks ago or are going to buy through hedging.
And yes, we do not know AF`s hedging strategy in detail but they stated that they are expecting a loss of 1bn€. So we can either believe it or not.
-_-_-_-_-_-_-_-
@AlexS:
$350 for a TATL is no doubt a good value. But when all taxes and fees are taken out, which portion goes to the airline? Can they really make money by selling this fare or is it a mixed calculation and the money comes from the other tickets?
Cant fix stupid. One horrible decision after another.
Airlines need some suffering right now...they earned it
Another I'll timed fee increase. Phoenix Sky Harbor airport just instituted a $4.00 fee per pickup & drop fee for ride share! Money grab and poor optics
I think it is time for Basic Economy fares to go away.
Hang on. European carriera charge more! SAS is $125 per bag. Pay the higher main cabin fare and bag and seat assignment are FREE
I am surprised Delta was not first to raise fees.
If you didn't think this is how they were going to pay back their taxpayer bailout, by charging taxpayers more for bags, you were clearly delusional.
@Klaus: No, it makes good sense that you can (could?) do a TATL flight for $350. What doesn't make sense is why it costs double that to travel domestically in the USA. I flew to Panama last year for $180/rt in Y. DL even served us a meal both ways. Tremendous value there.
@Klaus
You obviously don't know what is really going on.
1) A couple of months they prepaid fuel at a high rate.
Most US airlines are less aggressive to hedge fuel, even before the corona virus. If they do it is mostly a small percentage.
For EU airlines, they hedge way more aggressive but their strategy isn't just few months at a time, they hedge on 12-24+ months horizon. (So expect more hedge...
@Klaus
You obviously don't know what is really going on.
1) A couple of months they prepaid fuel at a high rate.
Most US airlines are less aggressive to hedge fuel, even before the corona virus. If they do it is mostly a small percentage.
For EU airlines, they hedge way more aggressive but their strategy isn't just few months at a time, they hedge on 12-24+ months horizon. (So expect more hedge loss for a year)
2) Fuel is now being “delivered” ... sell at at a lower price ... WTI is USD -37
Buying future contracts isn't the only way to hedge.
You do know why WTI went negative and Brent didn't right? Has nothing to do with hedging at all. Stop spreading fake news.
Now we don't know if AF shifted their hedge strategy (to cut loss and close their long term hedge) or not, even if they didn't they can expect loss to spike only this quarter as it will be marked to market and it dropping from $20 hurts much less than from $60.
So the airline clearly stayes we are raising our prices to match the other airlines. Wow , I thought price fixing was against the law. You can thank our legislators for ignoring most big business miss doings.
I can't blame them, what with the higher fuel prices they are facing! /sarcasm
Optics? How about a slap on the face to their customers who have stuck with them through thick and thin. And there was a lot of thin.
Hey, Ben. It must be because of those greedy baggage handlers.
Let all of the f^&*ing airlines go bankrupt and start over (said the 1 Million Mile Flyer and former Global Services member of United). Any business model based on seeing how cheap they can make their "service" for their customers is not a winning formula. I understand cutting costs to make a profit, but seeing how much pain the passengers can withstand as the price point is a losing proposition. I hope that they all go bankrupt!
@walester:
Good point! Since airlines are planning ahead of time when it comes to fuel they are buying fuel in advance at a fixed price. It`s called fuel hedging.
Now they have two problems:
1) A couple of months they prepaid fuel at a high rate.
2) Fuel is now being "delivered" to the airlines which they do not need. So they have to sell at at a lower price. And...
@walester:
Good point! Since airlines are planning ahead of time when it comes to fuel they are buying fuel in advance at a fixed price. It`s called fuel hedging.
Now they have two problems:
1) A couple of months they prepaid fuel at a high rate.
2) Fuel is now being "delivered" to the airlines which they do not need. So they have to sell at at a lower price. And because hedging is crazy the price for WTI is USD -37 (negative 37 USD) for a barrel.
Air France is expecting a billion euros of losses just for the prepaid fuel in the next months...
Well, of course, they're raising the checked bag fees, what with the added fuel expenses and everything.
Oh, wait...
I have OW elite status so this doesn't affect me on AA operated flights. However, I think it is even more shocking that DL and UA both provide a free checked bag for their CC holders whereas you only get that on domestic flights for AA credit card holders.
Then on the other hand, UA doesn't even provide a regular sized carry-on for domestic basic economy. So you can find pros and cons with every airline.
Truthfully, I don't purchase basic economy fares, so this doesn't matter to me. I suppose if you are buying basic economy you now should balance that ultra low fare with the costs of the "extras" and then decide if it's right for you.
@Victor
Yes, it's insane to pay $300 for a person and $140 for a bag on a round trip flight to Europe.
The bag is taking up significantly less space. The bag weighs 3-4 times less. The bag is not getting a hot meal and a snack and drinks. The bag cannot get sick or hurt.
I have to agree with KS. Delta has been the worst actor in this crisis (yes, worse than even United), yet I haven't seen a blog article about how bad they've been with refunds yet. It's especially disappointing because they were supposedly in the best shape of the big 3 financially.
@AlexS:
Isn`t it insane that a TATL roundtrip (?) can be purchased as cheap as USD 350?
@Alex_77W:
Yes, the whole point of the basic fare is to travel without luggage. With this pricing option the lexacy carriers are able to compete with low-cost airlines such as Norwegian that are now bankrupt.
@AW:
Yes, that is always strange. Profits go to shareholders and losses are socialized. In Switzerland they are currently discussing...
@AlexS:
Isn`t it insane that a TATL roundtrip (?) can be purchased as cheap as USD 350?
@Alex_77W:
Yes, the whole point of the basic fare is to travel without luggage. With this pricing option the lexacy carriers are able to compete with low-cost airlines such as Norwegian that are now bankrupt.
@AW:
Yes, that is always strange. Profits go to shareholders and losses are socialized. In Switzerland they are currently discussing government support of SWISS. Initial idea was that the government will get bonds SWISS in return. But since SWISS is owned by german Lufthansa and as Lufthansa is receiving government funding as well it is said to be too complicated from the administerial standpoint to give the swiss government SWISS bonds. So now they are discussing about a loan with fair conditions.
Two of the most overused and IMHO offensive word are “optics” and “tone-deaf”. Get over yourselves. Businesses and, to a lesser extent, individuals do what they feel is in their best interest and really don’t care what you think about it.
People act like their opinion on things like this matter. Please - grow up and worry about your own issues!! SMH
I don't think this has anything to do with cargo. Getting extra $15 doesn't make a revenue difference at all, especially this time. I'm going to say AA is sneaky and slide this in when nobody is really paying attention. When the skies open up, the new fee would be in place for long time. Makes AA look less bad rather than increase it just when the market is coming back. I don't think they...
I don't think this has anything to do with cargo. Getting extra $15 doesn't make a revenue difference at all, especially this time. I'm going to say AA is sneaky and slide this in when nobody is really paying attention. When the skies open up, the new fee would be in place for long time. Makes AA look less bad rather than increase it just when the market is coming back. I don't think they will do anything with domestic until recovery is in full swing.
Is timing good, I hate to say it after they got the bailout, but yes. If this didn't get attention it will slide right through. If it did backfire, this is still within the period of pre-planned rollout excuse.
On a positive note, AA possibly thinks travel will resume sooner and stronger than most expected.
@ JS:
Regarding your comment "Greed, greed, and more greed…" I am looking at the numbers of AA for 3Q19: Total Operating Revenue of USD 11.9 Billion and Total Operating Expensed of USD 11.1 Billion. The operating profit was USD 808 million which makes a GAAP Net income of USD 425 million.
I am wondering;
In your opinion, what would be an appropriate GAAP Net income so that you would not consider AA greedy?
@Greg: Calling a downgrade an enhancement is DL's PR tactic intellectual property. How can AA even think about using it?
DL has by far clearly been the leader in the race to the bottom starting with mileage program devaluations to dynamic award pricing to bistro meals. And yet, AA is the favorite for people to blame! When DL faces a class action lawsuit for denying passengers refunds, AA has been promptly providing refunds. And yet, DL is the customer-centric face of US. Excellent. I think some people are simply blind
Here we go again! AA always finds a way to screw up their customer, always!
With AA is 1 positive change, 5 negative changes.
It's your money (well, technically it's your grandkids' money) bailing them out. The American people will always be the airlines' suckers. The losses will always be socialized, and the profits will always go to management and the shareholders.
Why doesn’t the headline clearly indicate that this change only impacts Basic Economy tickets? Heck, most of the comments don’t either...
I'm surprised American hasn't called this an "enhancement".
How do you spell "tone deaf"?
@Alex_77W
Nailed it.
Just travel light. You are still allowed to take one carry-on + one personal item even with Basic economy.
Well, its AA. Would you expect anything different?
$75 for the first checked bag? For crying out loud, I've paid $350 or so for REGULAR economy TATL seats which included checked bags. Reason #3423 why Doug Parker needs to leave.
I strongly suspect this is related to the opportunity cost of cargo.
Completely tone deaf to the point the stupidity is almost laughable
#SMH
@James S.. its not insane if you are paying $300 for a RT to Europe. Everything is relative, no?
Maybe they’re gearing up for very cheap basic economy fares once the world is moving again?
On another note, they just redeposited points for my BXP1 that was set to expire in two days...0
Lucky - ironically, this comes right on the heels of your "Cute" AA Video post. There's nothing "cute" about anything AA does, I don't care what you say. This is their true colors coming through. Greed, greed, and more greed........................
75 dollars for a bag is absolutely insane
Might be intentional timing. Considering that nobody is flying right now, nobody is going to care.
One could suspect that when airlines raise fees, they see a short-term drop in demand which recovers over time as people get used to the new fee structure. No loss in demand when you're already at zero, and by the time we are flying again, people will have accepted the new pricing.
Just like Pelosi with her luxury fridge and ice cream. it just looks terrible.
American Airlines leads the way again.....in the race to the perceptual bottom!
Value of cargo on flights suddenly increased exponentially?