As I stand in line at the American Airlines ticket counter in DCA, I hear complaining about the $25 charge for a checked bag. The American agent tells the consumer, at least they are not charging for carry-on bags. The response of the consumer was “Who would do that? I wouldn’t pay it!” The answer is Spirit airlines will start charging for carry-on bags in August of this year. Free market has already started doing its job.
According to Spirit CEO Ben Baldanza, charging for carry-on bags will lend to having fewer carry-on bags. This will be a benefit to the passengers in many aspects. The boarding and deplaning time will be faster. There is also the added benefit of having overhead space when you need it. It is widely reported that the number one complaint people have about boarding is other passengers whose bags are too large to fit in the overhead bins and the time it takes to board and deplane the aircraft.
Baldanza said the idea is to get customers to pay for individual things they want, while keeping the base fare low. Carry-on bags that fit in the overhead bin will cost fliers $45 if paid for at the gate and $30 if paid online or at ticket counter. Fare club members pay $20 for each carry-on bag. There is no charge for carry-on items that fit under the seat. Baldanza states an interview with Fox news that Spirit has dropped base ticket prices by at least $45 to cover for the carry-on bag fee. He also states the checked bag fee were lowered.
Spirit is not breaking new ground by charging for extras on flights. Airlines have been charging extra fees for food service, checked bags, even for making reservations on the phone, basically anything they can. There is a loophole in the tax law that allows revenue produced on anything other than airfare to be taxed differently. There is basically an incentive to charge for “extras” when it comes to air travel, like the checked-bag charge. Most major air carriers started adding checked-bag fees in 2008. The airlines reported collecting nearly $740 million in baggage fees in the third quarter of 2009, according to U.S. Bureau of Transportation Statistics. (Pawlowski 6 Apr. 2010)
Congress is now accusing Spirit of going to far by charging for carry-on bags. Senator Charles Schumer’s concern is that other airlines will follow Spirit’s example by also charging for carry-on bags and not lower prices and consumers will get the short end of the stick. Senator Schumer said the law allows airlines to charge for anything that is not necessary for passengers to carry on board. He and Senator Ben Cardin said that carry-on bags do contain necessary items such as baby formula and medicine. Congress is moving to pass legislation that classifies carry-on bags as essential personal items. (Lowy, Joan 06 May 2010)
On the surface Spirit charging for carry-on bags seems to be just another way for airlines to raise ticket prices without putting it on the ticket. This may be true but we are part of a free market and the consumer will ultimately decide what they will pay for. Five major airlines have said they will not charge for carry-on bags but that is not true. You pay for all the amenities when you buy your high priced ticket. You are paying for your pillows, the bathrooms, oxygen masks, pilots, flight attendants and yes your carry-on bags. Most major airlines bundle all these small items together into the ticket price so you are paying for a pillow if you use it or not. It would be like the grocery store raising the price of bread to cover the cost of butter. Not everyone gets butter with bread or even wants butter. Why would you have to pay for it if you don’t want it? Spirit is an unbundled airline with an ultra-low cost. You pay for the services you use. Is Spirit’s plan going to work? Will it reduce time to load and disembark the airplane? Will Spirit raise prices in a year back to what they were? I don’t know the answers to any of these questions but what I do know is the free market will quickly and accurately decide what the people will stand for.
Work Cited
(Pawlowski, By A. “Airline to Charge for Carry-on Bags – CNN.com.” CNN.com International – Breaking, World, Business, Sports, Entertainment and Video News. 6 Apr. 2010. Web. 08 May 2010. <http://edition.cnn.com/2010/TRAVEL/04/06/spirit.carryon.fees/index.html)
(Lowy, Joan. "Spirit Airlines CEO Says Carry-on Fees Will Be Disclosed, Overall Ticket Prices Still Lowest – 5/6/2010 5:52:14 PM | Newser." Newser | Headline News Summaries, World News, Breaking News, and Local News. 06 May 2010. Web. 8 May 2010. <http://www.newser.com/article/d9fhkg7g0/spirit-airlines-ceo-says-carry-on-fees-will-be-disclosed-overall-ticket-prices-still-lowest.html.)
YouTube – 'Nickled and Dimed' at 30,000 Feet. YouTube – Broadcast Yourself. Web. 24 Apr. 2010. .
YouTube – Spirit Airlines CEO on Charging for Carry-Ons. YouTube – Broadcast Yourself. Web. 24 Apr. 2010. .