Airlines: Bag Fees on the Rise as Efficiencies Drop

U.S. scheduled passenger airlines reported a first-quarter 2019 net profit of $2.4 billion – bolstered by $1.3 billion brought in by baggage fees, a figure that represents 2.9 percent of airline operating revenues.

The U.S. Department of Transportation reports the amount brought in by fees between January and April 2019 is up from the $1.1 billion airlines earned during the same quarter last year. That rise may be attributed to increases in baggage charges during that time period. The average cost for the first checked bag on a U.S. airline domestic flight each way is $30, $40 for the second.

Reservation fees also saw substantial growth according to first quarter reports. Airlines took in some $662.1 million in reservation change fees and while airlines collectively earned $44.4 billion in the first quarter of 2019, $41.4 billion was spent on operational expenses, making the industry profitable only by slim margins.

While fees went up, some efficiencies may be going down for airlines.

In April 2019, carriers posted an on-time arrival rate of 79.8%, down from both the 80.9% on-time rate in March 2019 and from 81.3% in April 2018.

Highest Reporting Marketing Carrier On-Time Arrival Rates

Hawaiian Airlines Network – 89.0%

Alaska Airlines Network – 85.5%

Delta Airlines Network – 83.9%

Lowest Reporting Marketing Carrier On-Time Arrival Rates

JetBlue Airways – 73.4%

American Airlines Network – 77.6%

Frontier Airlines – 77.6%

April Cancellations

In April 2019, reporting marketing carriers canceled 2.4% of their scheduled domestic flights, up from both the rate of 2.0% in March 2019 and 1.1% in April 2018.

Lowest Reporting Marketing Carrier Rates of Canceled Flights (ATCR Table 6)

Hawaiian Airlines Network – 0.1%

Allegiant Air – 0.7%

Delta Airlines Network – 0.7%

Highest Reporting Marketing Carrier Rates of Canceled Flights 

Southwest Airlines – 4.0%

American Airlines Network – 3.2%

Spirit Airlines – 2.7%

Tarmac Delays

In April 2019, airlines reported 29 tarmac delays of more than three hours on domestic flights, compared to five such tarmac delays reported in March 2019 and one tarmac delay reported in April 2018.  In April 2019, airlines reported one tarmac delay of more than four hours on international flights, compared to three tarmac delays reported in March 2019 and no tarmac delays reported in April 2018.  April’s worst tarmac moments:

* Spirit Airlines flight 549 from Hartford, Conn. to Orlando, Fla. was delayed 5 hours and 16 minutes on the tarmac at Orlando

* Spirit Airlines flight 1852 from Denver to Orlando, Fla., was delayed 4 hours and 34 minutes on the tarmac at Orlando

* American Airlines flight 1352 from Chicago O’Hare to Los Angeles was delayed 4 hours and 12 minutes on the tarmac at Chicago O’Hare

Mishandled Baggage

In April 2019, the reporting marketing carriers posted a mishandled baggage rate of 5.40 mishandled bags per 1,000 checked bags, a higher rate than March 2019’s rate of 5.24 per 1,000 checked bags.