dailyloe.com – American Airlines increased its checked baggage fees on Thursday, joining a recent industry-wide trend. The hikes are most significant for passengers holding basic economy tickets. This move responds to rising operational costs, primarily jet fuel.
United Airlines, JetBlue Airways, Delta Air Lines, and Southwest Airlines all raised fees in the past two weeks. Industry executives cite a jump in jet fuel expenses linked to Middle East tensions. The effective closure of the Strait of Hormuz is further squeezing fuel supplies.
For most tickets, American’s first checked bag now costs $50 at the airport. A second bag will cost $60 for these standard fares. A $5 discount applies for checking bags online via the airline’s website or app.
Basic economy passengers face steeper charges starting May 18 for new tickets. Their first checked bag will cost $55, and a second will be $65. The online discount reduces these to $50 and $60, respectively.
All basic economy travelers will also pay to select seats from May 18. They will not be eligible for complimentary or system-wide upgrades. This applies even to customers with elite status in the airline’s loyalty program.
Jet fuel is the industry’s second-largest expense after labor. Airlines are grappling with how to cover the full run-up in fuel prices. Despite high travel demand, carriers are adjusting ancillary fees accordingly.
The broader strategy sees airlines leaning into premium cabin offerings. Simultaneously, they are making basic economy fares more restrictive. This tiered approach aims to manage costs while segmenting customer revenue.[]
Source: CNBC
