Earlier this week, JetBlue became the first airline in the United States to increase checked bag fees in recent times. This is an area where JetBlue tends to “lead,” and there’s now an update, as one of the “big three” carriers has followed JetBlue’s lead.
In this post:
United tries to boost revenue with higher checked bag fees
Airlines are obviously in an incredibly tough spot at the moment. We’ve seen a massive increase in fuel costs, which is one of the biggest variable expenses that airlines have. If oil prices don’t decrease from these levels, even the world’s most profitable airlines will be losing money, while those airlines that were previously struggling may be in bankruptcy.
For tickets purchased as of today (Friday, April 3, 2026), United has increased checked bag fees by $10 for the first and second bag, and by $50 for the third bag and beyond. United’s checked bag fees vary based on whether you pre-pay for them 24 hours or more before departure, or whether you pay within 24 hours.
With this change, if you pay within 24 hours of departure, you’ll pay $50 for your first checked bag ($40 before), $60 for your second checked bag ($50 before), and $200 for your third checked bag ($150 before). Meanwhile if you pre-pay, you’ll get $5 off those amounts.
In a statement, United emphasizes that this is the first time in two years that the airline has raised checked bag fees.
Why United is raising checked bag fees instead of fares
In recent weeks, we’ve heard a lot of airline executives warn that airfare could go up due to higher oil prices. The issue is that demand for airfare is pretty elastic — when airfare goes up, demand goes down.
Even beyond that, Americans are feeling the impacts of higher oil prices, so many people also have less disposable income (though the “premium” airlines love to boast about the wonders of the K-shaped economy). If airlines could just easily raise prices, we wouldn’t be in a situation where most US carriers are turning operating losses.
From the perspective of airlines, if they desperately need to extract more revenue from passengers, increasing checked bag fees is a logical place to start, since it’s not a detail that passengers compare quite as closely as just direct ticket costs.
So yeah, the price of oil is impacting checked bag fees, but that’s simply because it’s a more practical way to try to increase revenue, compared to outright raising fares.
Bottom line
United has just increased checked bag fees by $10-50 per flight. The increase is $10 for the first and second checked bag, and $50 for the third bag and beyond, and there’s still a $5 discount for paying more than 24 hours in advance.
Airlines see raising checked bag fees as the easiest way to boost revenue without having to increase fares. JetBlue started this round of bag fee increases, United quickly followed, and I’m sure other airlines won’t be too far behind. And remember, once costs go up, they rarely come down.
What do you make of United increasing checked bag fees?
A bag carried on for free adds the same weight to the airplane that it would if it were checked.
But does it drop when oil goes back down? Or is it like a bridge toll. Once it goes up for whatever reason, it never drops again. I'm pretty sure I know the answer.
The premium enshittification of United.
Just another way to raise prices while claiming you're not raising them since base fares stay low... especially in the Google searches.
I'm surprised the gov't isn't like "Hey...wait a minute" with these price increases since excise taxes and the like are based of the base fare and not fees so the gov't isn't getting its cut from overall price increases.
And when fuel prices go back to "normal"? Think bag fees will return to "normal"? Nope!
United has essentially made their basic economy worthless for most people since they won’t let you bring a carry on and you have to check it. Might as well just buy up and get the flexibility on your ticket and carry on included.
This is a good point. The difference between B.E. and regular is typically around $50 per direction, at least domestically.
Of course, UA is the first of the big 4 to raise baggage fees. Fares have already been increased across the board and there are limits to how much fares can increase.
UA was the first of the big 4 and one of the first US airlines to talk about the impact on UA of higher oil costs - which could add $11 billion to UA's costs at $175/bbl oil. Problem for UA's calculations is...
Of course, UA is the first of the big 4 to raise baggage fees. Fares have already been increased across the board and there are limits to how much fares can increase.
UA was the first of the big 4 and one of the first US airlines to talk about the impact on UA of higher oil costs - which could add $11 billion to UA's costs at $175/bbl oil. Problem for UA's calculations is that jet fuel is way more costly than $175/bbl because of the very jet fuel crack spread which is about as high as the cost of crude; Argus calculated the simple average for US crude at major ports as $4.88/gal - $2/gal higher than just 2 months ago.
UA has long had the highest fuel cost per gallon due to its large presence on the west coast and the gap is even wider now because of the closure of refineries and pipelines on the west coast. AS is also facing massively rising jet fuel prices; they get about 20% of their total jet fuel needs from SIN which is seeing some of the highest jet fuel prices in the world because it is dependent on crude coming through the Strait of Hormuz.
A number of Asian and European airlines are putting together plans to cut capacity not just because high prices will destroy demand - even though Scott Kirby said that demand would remain constant at higher fuel costs - but because jet fuel shortages are likely in Europe and Asia. Diesel prices have soared as well and is far more important to the global economy than jet fuel.
this is an absolute economic disaster for nearly all airlines except for one with operational meltdowns possible by summer.
All it was going to take to undo UA's rah-rah "we are great" growth plan was one black swan event that would disproportionately impact UA.
We are in that black swan event right now and it will get much worse before it gets better.
UA's "$11 Billion" in extra costs projection was based on oil hitting $175 per barrel - which it isn't - and STAYING at $175 per barrel - which is unlikely. $4.88/gal currently is not coming off $175/barrel oil.
And despite Delta's ability to produce jet fuel from their refinery, the leveraged advantage does not magically create OIL at a cheaper price. Delta still has to buy oil on the open market - Delta's advantage is...
UA's "$11 Billion" in extra costs projection was based on oil hitting $175 per barrel - which it isn't - and STAYING at $175 per barrel - which is unlikely. $4.88/gal currently is not coming off $175/barrel oil.
And despite Delta's ability to produce jet fuel from their refinery, the leveraged advantage does not magically create OIL at a cheaper price. Delta still has to buy oil on the open market - Delta's advantage is taking out the middle man in production, i.e. turning the oil into jet fuel. Delta will get to share in the higher costs / lower profit margins if oil climbed to, and stayed at, $175 per barrel. Besides, Delta cannot produce 100% of their jet fuel. They still have to buy the vast majority of fuel from other producers.
When United posts quarterly and annual earnings for 2026, and still has a good year instead of a great year, your post will be fun to remind you about.
first, feel free to argue whether UA will pay $5 billion or $11 billion more in fuel costs; the numbers are only a matter of scale. There will be massive damage to the global airline industry and it is already happening and will only accelerate.
DL is getting a cost advantage NOW from the refinery and it is because it owns part of the means of jet fuel production which also produces other refined products....
first, feel free to argue whether UA will pay $5 billion or $11 billion more in fuel costs; the numbers are only a matter of scale. There will be massive damage to the global airline industry and it is already happening and will only accelerate.
DL is getting a cost advantage NOW from the refinery and it is because it owns part of the means of jet fuel production which also produces other refined products. Of course, DL's fuel costs will increase but you simply cannot w/ a straight face deny that DL is enjoying some massive reductions in the cost of jet fuel not only because the refinery produces jet fuel at lower costs than the market from which other airlines have to buy it but also because refineries and esp. the DL refinery become much more profitable when there is a huge crack spread which exists now not just for jet fuel but also for diesel.
DL does produce directly or indirectly through product swaps 75% of its jet fuel requirements. The refinery saved DL $777 million or 23 cents/gallon in 2022 and half that amount in 2023 even w/ the refinery offline for part of the year.
There isn't a global petroleum analyst that believes that jet fuel prices will come back down even if the Strait is reopened tomorrow. This crisis is easily an 18 month or longer cost crisis - and UA, whether you want to admit it or not - is far more deeply exposed than any other airline except for perhaps AS.
Let's also not forget that UA has labor settlements that should close in 2026 which will increase costs and also has far higher capex than any other airline; their cash flow will dramatically slow as costs increase and they will have no choice but to take on debt. Airbus and Boeing are not deferring airplanes over the next 2 years.
This crisis could easily push some airlines into chapter 11 - even if that isn't an immediate risk for UA.
The article and comments to bring back up are the ones talking about how cool UA is and how some are convinced it is leading the industry.
None of that matters in the face of huge cost increases that will result in demand destruction as fares and fees are increased and service is cut.
UA's business plan was always high risk and high reward would only come if everything went right. On top of multiple other things happening uniquely to UA, massively higher fuel costs are a black swan event for UA.
Let's do wait for first quarter earnings and guidance which starts with DL next week and will be complete in a month for the US industry and a bit longer for other airlines worldwide.
Your optimism about how well UA will handle this is severely misplaced while your inability to accept that DL has a massive cost advantage that it will use just as much if not more than UA used its post covid strategy to its advantage.
Yep, Tim:
1) You know how long this crisis will last at a minimum (18 months) when nobody else does. So cool! Can I borrow your Magic 8 Ball one day?
2) Your logic has argued that United's labor costs will go up because of the increased pay coming to flight attendants - fair enough. But you've also argued that Delta will match or beat United's pay by increasing their own flight attendant's pay. Yet...
Yep, Tim:
1) You know how long this crisis will last at a minimum (18 months) when nobody else does. So cool! Can I borrow your Magic 8 Ball one day?
2) Your logic has argued that United's labor costs will go up because of the increased pay coming to flight attendants - fair enough. But you've also argued that Delta will match or beat United's pay by increasing their own flight attendant's pay. Yet Delta will not have a labor disadvantage somehow. Hmm... math is hard, apparently.
3) I've re-read that "Kirby Memo" that mentioned the $11B in costs. That wasn't a projection of what he expects WILL happen - that was just a hypothetical to explain to employees how high oil costs impacts the industry IF it got that high and stayed there.
You think Kirby doesn't have a plan to react? He's been reported to have said that United has a plan, and much of the rest of the industry is relying on "hope". But you seem to think United WILL have $11B in higher costs, and only United would have to mitigate increased fuel expenses.
I've got no skin in the game - I'm an entertained observer of the industry who wants my flights to be comfortable, safe, and on time. I have no "misplaced optimism". But your criticisms sound just like the same ones thrown at United during Covid - when passenger loads dropped by 90% - this is nothing like what happened then. And United's management team made the right moves to pivot even stronger coming out of Covid than going into it - more than Southwest, more than American, and even more than Delta. I'm willing to give them the leeway to believe they can do it again.
I realize this is all very hard for you and the UA fan club to accept but
1. find a petroleum analyst that thinks that this will be all be over as soon as the Strait is over. Not one I have read says that.
2. DL ALREADY has higher labor costs - so does AA and WN. UA has lived off cheap labor. Their statements that their guidance included higher labor costs...
I realize this is all very hard for you and the UA fan club to accept but
1. find a petroleum analyst that thinks that this will be all be over as soon as the Strait is over. Not one I have read says that.
2. DL ALREADY has higher labor costs - so does AA and WN. UA has lived off cheap labor. Their statements that their guidance included higher labor costs mean nothing in light of higher fuel costs; of course, they want to tell us all now that their guidance assumed these labor costs since fuel increases will be far larger than labor cost increases.
3. Again, tell us what increase in costs that UAL WILL incur. It might not be $11 billion but the cost of crude doesn't really matter because the crack spread is what is pushing up jet fuel costs and it has gotten larger relative to crude costs.
We know know what Kirby's plan was - to steamroll competitors and aggressively grow - and that strategy doesn't work in a high fuel cost environment esp. when competitors will pay less than UA.
UA can't turn off that aggressive growth plan over night. Airbus and Boeing will require UA and every other customer to take planes or end future deliveries. the whole risk of such massive capex is that it is unsustainable when the bottom drops off.
You can cling to what worked for UA post covid all you want but this is an entirely different type of scenario. Demand is going to fall off even as costs go up and hit UA disproportionately hard.
It is not even a guarantee that other big 4 airlines will match UA's baggage fee increases. UA handles less baggage than AA, DL or WN so the baggage fee increases will do less for UA than for other carriers.
I have said for years that UA's business plan was risky and excessively agressive and subject to falling apart and that is exactly what we are seeing.
no need to argue all day long. just wait for earnings and esp. guidance to come out starting next week.
I can absolutely assure you that there will be nothing cool or innovative about the increased costs that UA has to bear or the steps it has to take to minimize damage to its business.
You can at least admit that any airline management has access to a lot more data than you and I have, yes? And I think you'd agree that the SEC has some pretty strict laws regarding financial disclosures. Those largely drive any company's release of financial information, results, and projections (and the need to be transparent about a company's finances).
Let's review:
Jan 20th, 2026: United releases FY2026 earnings guidance of $12-$14 per share.
Today,...
You can at least admit that any airline management has access to a lot more data than you and I have, yes? And I think you'd agree that the SEC has some pretty strict laws regarding financial disclosures. Those largely drive any company's release of financial information, results, and projections (and the need to be transparent about a company's finances).
Let's review:
Jan 20th, 2026: United releases FY2026 earnings guidance of $12-$14 per share.
Today, April 3rd, more than a month into the Iran war:
United's Investor Relations portion of their website indicate FY2025 earnings guidance of $12-$14 per share. So it's unchanged.
If I recall correctly, Kirby said he expected earnings to now be in the lower portion of the original guidance (thus - the war and higher oil WILL have some impacts) but United is able to keep the guidance the same as before the war started. He also said something about 10 of the strongest weeks of bookings. So United believes the impacts will not be so catastrophic, like you seem to believe, that they had to reissue new earnings guidance.
I find it hard to believe all of United's management is wrong and you are the only one right, especially when United is the one that has to answer to the SEC.
"United's Investor Relations portion of their website indicate FY2025 earnings guidance of $12-$14 per share. So it's unchanged"
Sorry - typo. That is FY2026 guidance still at $12-$14 per share, unchanged.
@Michael M.
Tim doesn't have a Magic 8 ball.
Tim's ball is magically shaped a triangle.
this is only getting worse by the day
"Iran rejects U.S. demands; ceasefire bid breaks down – WSJ"
You have to have your head under a rock if you don't think that airlines are in serious trouble right now.
and for the reasons listed above, UA is highly vulnerable.
None of AA, DL or WN moved first of the biggest airlines to talk about the negative impact of high fuel or to match little B6' baggage fee increases - but UA did for good reason.
*(bookmarks this page so it can be referenced later this year when Tim is wrong again)
*(erases bookmark because previous posts by Tim have been ignored by Tim when he was wrong so many other times in the past)
go right ahead.
all you prove is that you, just like the rest of the United internet defense force and UA execs are incapable of accepting any legitimate criticism of UA.
UA has engaged in a reckless growth strategy that was publicly committed to steamrolling the competition and harming the American public. The government has stepped in multiple times.
and this time, the President that Kirby mocked just 4 years ago and has kissed up...
go right ahead.
all you prove is that you, just like the rest of the United internet defense force and UA execs are incapable of accepting any legitimate criticism of UA.
UA has engaged in a reckless growth strategy that was publicly committed to steamrolling the competition and harming the American public. The government has stepped in multiple times.
and this time, the President that Kirby mocked just 4 years ago and has kissed up to for the last year (after criticizing them ruthlessly when UA's EWR operation melted down) has now dragged the world into a mess in the Middle East that is far from over and is going to inflict major damage, esp. on the airline industry.
UA's growth plans were ONLY ever going to work IF everything went flawlessly - and yet EVERYONE knows that never happens.
UA is highly exposed to high fuel costs in a high capex period - and THAT is why UA was the first airline to warn about damage from high fuel prices and is the first to match B6' bag fee increases.
UA will be fighting for its life in 2026 and not at all be in a position to inflict damage on other companies.
It's really all sort of a karma moment and we know full well that you never were going to accept that someone else could see through UA's facade
I can only imagine how many hundreds of millions of dollars airlines pay for fuel every month. It's going to be interesting to see if the low cost carriers can survive this.
each of the big 3 US legacies (AA, DL and UA) said that fuel costs increased $400 million in the 1st quarter and the war started at the end of February - so only one month before the end of the quarter.
UA said that the impact would be $11 billion/year.
Delta also said that its refinery would begin to kick in benefits to DL's fuel costs in the 2nd quarter (which we are...
each of the big 3 US legacies (AA, DL and UA) said that fuel costs increased $400 million in the 1st quarter and the war started at the end of February - so only one month before the end of the quarter.
UA said that the impact would be $11 billion/year.
Delta also said that its refinery would begin to kick in benefits to DL's fuel costs in the 2nd quarter (which we are now in). DL's refinery delivers benefits when the jet fuel crack spread is high and we are in precisely that condition now. The refinery saved DL $777 million in 2022 and another $385 million in 2023 - and the refinery was offline for 3 months in 2023 due to maintenance. The price of diesel is also soaring and a barrel of light sweet crude can typically produce more diesel than jet fuel.
Most of the industry except DL has few options other than cut capacity to deal w/ higher fuel costs.
As it was designed to do, the refinery will lower the rate of increase of DL's fuel bill and that is already happening and will only accelerate given that the Strait is nowhere near close to reopening.
A $ 1 billion plus fuel cost savings by one airline compared to its peers is going to have huge competitive impacts.
But wait. United is the cool airline nowadays that only does cool nowadays things.
If this was logical, then the next step would be to charge a supplement based on passenger weight. There would be some initial outcry about rights etc but lawyers would take care of this inconvenience. If your weight was above the average, then you would pay an extra amount based on a sliding scale fee. Americans, being on average heavy, would suffer substantially when flying on European carriers. Instead of weighing your bags, the airline...
If this was logical, then the next step would be to charge a supplement based on passenger weight. There would be some initial outcry about rights etc but lawyers would take care of this inconvenience. If your weight was above the average, then you would pay an extra amount based on a sliding scale fee. Americans, being on average heavy, would suffer substantially when flying on European carriers. Instead of weighing your bags, the airline would weigh you. It is of course a money grab that, like income taxes, will not be temporary.
We're at the threshold of a global oil shock and economic recession if not worse. Blame the US.
It's funny how everything goes up in price, but people seem to think oil has to somehow stay permanently down.
Also, will United reduce bag fees if oil does go down in price? I'm guessing no.
Same can be said about the price of airline tickets.
It’s the ONLY consumer product that hasn’t gone DOWN vs inflation over the last 20 years.
That's just not true. Next month I'm flying across Europe twice - a direct flight of over 1600 miles then a few days later flying with a connection for a total distance of just under 2.5k miles. All three flights are in business class and the tickets include 64kg of luggage, priority security, lounge access, hot meals, alcohol etc. Total cost: €554, which on an inflation-adjusted basis corresponds to €360 in 2006... when many airlines...
That's just not true. Next month I'm flying across Europe twice - a direct flight of over 1600 miles then a few days later flying with a connection for a total distance of just under 2.5k miles. All three flights are in business class and the tickets include 64kg of luggage, priority security, lounge access, hot meals, alcohol etc. Total cost: €554, which on an inflation-adjusted basis corresponds to €360 in 2006... when many airlines wouldn't even sell you an one-way in Y for much less than full fare (€500 or so).
Baggage fees are the following the resort fee playbook in terms of obfuscating total costs