The End of the World as We Know It; or, American to Charge for Checked Baggage

You’ve no doubt seen elsewhere that American is now going to charge you to check your first bag. All of the stories, I’m certain, will have quotes from some travelers saying they’ll never fly again, and other quotes from travelers saying that they understand airlines have to make money. That’s the crux of the story.

As I wrote in my obituary to the airline industry a couple of months back, we are already in the era of the no-frills full-frills carrier, and this move simply demonstrates this effect further. Last week I booked some tickets on Spirit Airlines and my father was saying how ridiculous it was that Spirit charged you to check a bag. I was saying that when they frequently charge $2 for tickets, a bag charge doesn’t seem all that crazy. I guess a bag charge wasn’t crazy, regardless of who you fly.
The longer-term question for me is this: the airline industry is extremely cyclical and assuming things get good at some point, how will American (and the other no-frills full-frills carriers) position themselves? What’s their brand stand for? How will they ever possibly compete with Southwest?

I’m not at all saying this was a bad move — these carriers have to do something drastic given the fuel costs, but long term I’m not sure how they survive. Which is basically what JP Morgan wrote yesterday: that basically every airline (save Southwest and Allegiant) were bankruptcy risks. If I hadn’t already written the obituary, I would now…

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  1. ok, you were right with the obit.

    I guess what steams me about this latest AA transgressions is it is going to steer more people into bringing carry-ons abroad. And yes, I know, you can “red-tag” it at the counter. But how many times have I brought a carry-on for a flight that works well for a 737 but not a RJ – and have had to gate-check it for one segment?

    Also, the fee system (as opposed to raising fare) seems to be an end-run about booking engines. American is particularly bad about displaying fees.

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