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Airline Baggage Revenue up 33 Percent by Steve Robinson
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Airline Baggage Revenue up 33 Percent |
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Business,Current Affairs,Travel & Tourism
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Given rising baggage fees, it is becoming increasingly challenging for travelers to keep cheap airplane tickets and cheap vacation packages really cheap if they have to check bags. According to the Transportation Department airline revenue from checked bags increased to $769 million in the first three months of this year vs. $578 million in the first quarter of last year. Airlines also earned $554 million in fees to change reservations and another $534 million from other services, including sales of frequent flier miles and fees for flying pets. Airlines total ancillary revenue remained relatively unchanged with the first quarter of last year. Experts interpret this to mean that passengers are paying for services that they view as essential, such as checking bags. However, they are staying away from many nice to have, but less valuable services, such as paying a fee to change a reservation to return home a few hours early. Spirit Airlines, which is a relatively small airline, has often been the first to charge its customers for additional services that used to be included in the ticket price. Spirit derived almost 22 percent of its operating revenue from fee income, which is the largest percentage among U.S. airlines. The airlines appear to be determined to increasingly come up with additional ways to boost their ancillary revenue. Some airlines are now offering access to quicker security lines and/or early boarding for a fee. Rest assured, the airlines will continue to creatively come up with additional “optional” services for which they can charge fees. www.cheapfares.com
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