Baggage fees are big business for American Airlines, bringing in an industry-leading $1.2 billion in revenue last year for the world’s largest carrier.
And even the airline that boasts “bags fly free” — Southwest Airlines — collected a tidy $50 million from charging passengers for extra luggage. It gives passengers two free checked bags before it tacks on fees.
Overall, the airline industry racked up $4.9 billion in 2018 by charging customers baggage fees, according to new data collected by the U. S. Bureau of Transportation Statistics. It was the most lucrative year since airlines started the practice more than a decade ago.
Airlines have used bag fees as a revenue booster for several years now. American Airlines began charging in 2008. Its cost has risen from $15 a bag to today’s $30 fee .
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The industry’s lobbyists scored an important victory last year when they got a provision removed from legislation that would have put limits on fees airlines could charge for flight changes and baggage. The Federal Aviation Administration reauthorization bill was signed into law in October by President Donald Trump.
Airlines like bag fees because they aren’t subject to the same taxes as revenue gained from ticket sales. The fees also don’t show up in online ticket price searches.
Those fees, however, were a “considerable” detractor from passengers’ travel experiences in 2018, according to the most recent American Customer Satisfaction Index survey. The survey found that leisure travelers in particular have a lower level of satisfaction with airlines when they’re required to pay fees for either checked or carry-on baggage.