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The Honolulu Advertiser
Posted on: Monday, September 28, 2009

Extra fees boost airline earnings


By ROGER YU
USA Today

U.S. airlines are raking in more money this year from extra fees, although fewer people are flying.

In the first six months of this year, the airlines collected $3.8 billion for checking bags, canceling or rebooking flights, carrying pets and assigning seats, the latest data from the Department of Transportation's Bureau of Transportation Statistics show. That's up from $2.3 billion for the first half of 2008.

The reason for the increase: Airlines are charging more for services as they seek to offset the worst downturn in travel since after the Sept. 11, 2001, terrorist attacks.

"Fees are much higher this year," says Anne Banas of SmarterTravel, which tracks the fees airlines charge.

Checked-bag fees are the most lucrative source of extra money. Revenue from them was $669 million in April, May and June alone, up 276% over what they brought in the same time last year. In the first six months of the year, airlines collected $1.24 billion in baggage fees.

Bag fees, which are among the least popular with travelers, are fairly new. But they've quickly expanded.

Airlines began imposing them in spring 2008 on the second bag passengers checked. Then some began charging for the first checked bag.

Revenue from fees imposed for canceling or rebooking flights rose 52 percent in the second quarter to $606 million. Revenue from miscellaneous fees — for assigning seats, flying pets and fees paid to the airlines for collecting airports' passenger facility charge — totaled $673 million in the second quarter, up from $565 million a year ago.