Tuesday, March 8, 2011

Airlines to Load on More Fees

Oil futures are not the only source of additional fees for airline service. In their insatiable drive to find new ways to dig out profits, airlines will be charging for more services. Some of which you may have taken for granted. The new standard of checked bags, snacks, competitive seat selection and other now standard fees brought in $22 billion last year. Spirit Air derives 27% of its revenue from these fee sources:

This has, well, excited airline executives to the possibility of more revenue and some of those new sources may be as follows:

Infants riding in a parent's lap: Domestic flights could start charging the same kinds of fees (10% of an adult fare) that are charged for lap-riding infants on international flights.
Using a credit card: Cash-paying customers would get a 3% discount, effectively charging a 3% fee to credit card customers.
Checked baggage based on weight: Instead of paying a flat rate for your checked bags, the fees would be based on the weight of each item.
Carry-on bags: Spirit Airlines already began charging for some carry-on items last year. Don't be shocked if more carriers follow suit.
A pre-ordered champagne brunch in economy class. Well that’s worth it.
Weather related flight cancellation insurance.
Upscale meals delivered in coach.
In-flight movies.
Wi-Fi
A new “economy comfort zone” or “economy plus” premium coach seats designed for more leg room (4 inches!) and 50% more reclining which could cost from $80 – $160 each way. Annual upgrade to economy plus could cost $450 a year with Continental.

Although some believe that charging for once free items has reached its limit, these new upgrade money makers are based on creating a more comfortable flight. Creating value for the additional spend. "Passenger-pleasers."