American and Delta match the higher bag fees charged by United and JetBlue
With travel demand growing and the price of jet fuel rising, Delta and American Airlines have raised checked bag fees, matching the higher prices adopted in the last few weeks by JetBlue and United.
American Airlines, the world’s biggest airline, became the latest carrier Thursday to announce that domestic travelers will pay $30 for the first checked bag, up from $25, and $40 for the second bag, up from $35. The fee increase takes effect with bookings made Friday.
“This is the first time American has changed its domestic checked bag fees since 2010 and follows similar changes made by other airlines,” the Fort Worth carrier said in a statement.
The move follows Delta Air Lines’ bag fee hike Wednesday, when the Atlanta carrier also raised checked bag fees by $5, to $30 for the first bag and $40 for the second. JetBlue and United initiated the trend by hiking bag fees last month.
Industry experts attribute the increases to pressure on airlines that face shrinking profits because of higher fuel costs and salaries.
The U.S. Bureau of Transportation Statistics reported this week that the U.S. airline industry — represented by the 21 biggest carriers — collected after-tax net profits of $3.4 billion in the April-through-June period, down from $4.7 billion in the same period in 2017. Profits are being eaten away by higher expenses, including fuel costs that rose 34.5% in the same period.
But the nation’s biggest carriers collected $1.2 billion from bag fees in the second quarter of 2018, up nearly 5% from the same period in 2017, according to the bureau.
“Airline profits, although still far higher than back in what they remember as the bad old days of the 2000s, have been under some pressure in the past couple of years because of rising fuel costs and also rising labor costs,” said Seth Kaplan, managing partner at the industry publication Airline Weekly. “They’ve probably decided this fee has been $25 for nearly a decade at most airlines, and they’d rather raise that by $5 than, for example, cut some of the services they’ve restored in recent years — the free snacks and so forth.”