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The US Department of Transportation’s Bureau of Transportation Statistics released some fantastic news — that is, if you’re a major shareholder in a US-based airline. A recent report from the US DOT shows that for the 10th straight quarter, US-based airlines earned in excess of $1 billion in baggage fees alone — news that’s far from fantastic for passengers.
The US DOT report found that airlines earned nearly $1.3 billion in bag fees in the third quarter of 2018. Additionally, airlines have raked in more than $3.6 billion in bag fees during the first nine months of 2018. This past quarter, almost 3% of earned revenue for US airlines came from bag fees. American Airlines has earned the most through baggage fees, understandably so as the airline is the largest passenger airline by passenger volume.
While American Airlines might have earned the most in bag fees through the third quarter, American earned far less per passenger than other airlines. Frontier and Spirit had by far the largest fee-per-passenger ratio. This is thanks to the ultra-low-cost business model used by both Frontier and Spirit. While the base fare is typically lower on both Frontier and Spirit, neither airline includes carry-on or checked luggage in the price of a ticket.
All three major airlines including American Airlines, Delta Air Lines, and United Airlines have raised the price of the first checked bag from $25 to $30. Other major US airlines including Alaska Airlines, Hawaiian Airlines and JetBlue have also upped the price to check a bag. This will ultimately mean even greater numbers in future quarters.
Featured image via Shutterstock
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- Earn 35,000 Membership Rewards® Points after you spend $2,000 on eligible purchases with your new Card within the first 3 months.
- Earn 4X Membership Rewards® points at U.S. restaurants. Earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per year in purchases, then 1X).
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- $100 Airline Fee Credit: up to $100 in statement credits per calendar year for incidental fees at one selected qualifying airline.
- Choose to carry a balance with interest on eligible charges of $100 or more.
- No Foreign Transaction Fees.
- Annual Fee is $250.
- Terms apply.
- See Rates & Fees