Update: United & US Air to Charge $15 For First Checked Bag

mike lewis

• June 13 2008
• 5 comments

Ouch. With that backpack, he’s looking at a minimum of $330 extra round trip. Any of those over 50 lbs? Tag on another $250.
Photo: Nick Hamilton

A mere three weeks after the world’s largest carrier, American Airlines, announced it would be charging $15 each way to passengers for their first checked bag, number two United Airlines and number seven US Air announced similar policies. Add to this a $25 per flight charge for the second checked bag and flights are definitely trending up with the price of fuel, despite limited increases in stated ticket prices.

UAL Corp.’s United said its baggage fee goes into place immediately with customers who buy tickets today, Friday, June 13 for domestic flights of Aug. 18 or later. It does not apply to customers flying in first or business class or those who have premier status with United or Star Alliance, and first and second bags will still be free for itineraries that include international flights, aside from Canada.

United is also increasing the fee to check three or more bags, overweight bags or luggage that requires special handling to $125 from $100, or to $250 from $200, depending on the item.

“With record-breaking fuel prices, we must pursue new revenue opportunities while continuing to offer competitive fares by tailoring our products and services around what our customers value most and are willing to pay for,” said John Tague, United’s chief operating officer.

United estimates the potential revenue from baggage handling service fees at about $275 million a year. It expects the new $15 service fee to apply to one in every three customers.

Hundreds of Thousands of skiers and snowboarders, as well as numerous industry employees and team members, fly the friendly skies each year to sample the snow of distant resorts, and the ski and snowboard industry has been actively campaigning to get the airline industry to reconsider these charges which may deter riders from traveling to destination resort or change their habits.

One way around incurring these added charges is to simply not bring gear with you. Rick Kahl, editor of Ski Area Management magazine states that “if you’re spending a couple thou on a snowboard vacation, what’s another $50? This new charge may encourage more people to hold onto their old skis or boards and just rent newer gear when they go on vacation. That trend has been underway at destination areas for several years, and this gives folks one more reason to join it. It’s not the cost that has been driving the trend, it’s the hassle. And that, combined with the added cost, will probably fortify the trend.”

“I do not have an exact figure but have been told by multiple sources that 20% of skiers rented skis 6-8 years ago and now it is over 50%,” states Bryn Carey, founder of Ski Butlers, which offers in room ski and snowboard fitting for tourists at 21 resorts in the U.S. and Canada. “Most of the ski companies are worried now b/c retail is down, people simply aren’t buying and with services like ours that makes it so convenient to rent, why buy?”

Ken Gart, President of Specialty Sports, which owns approximately 100 specialty shops offering rentals and demos in California and Colorado, foresees the biggest impact being on their demo boards, which currently make up about one-third of their rental fleet. “The people that generally bring their own skis and boards are usually a bit more hardcore and want better product.” Gart says that his company is taking a wait and see attitude for next season on making their store layouts more rental heavy and significantly upping the percentage of demos.

“I can guarantee you will see some rental shops and local retailers that are going to capitalize on this trend with snowboards as well,” says Rossignol National Sales Manager and North American Product Manager Eric Hutchison, whose company currently controls approximately 30% of the U.S. rental market. I could envision a lot of resort shops, in particular ones that are owned by the resort itself, moving some of their retail buys over to high performance rentals and pairing that with aggressive marketing plans aimed at luring a former retail oriented customers over to a rent while you stay type package bundled in with a lodging/lift ticket program.

As of July 1st, Southwest will be the remaining industry holdout that lets you check two bags without breaking out your wallet.

To read more about the expected effects of these changes on the snowboard industry, check out the May issue of Transworld Business.

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