Wednesday, June 27, 2012

Jennifer Waters's Consumer Confidential: Tools to help you navigate airline baggage fees

By Jennifer Waters, MarketWatch

CHICAGO (MarketWatch) — It’s easy to reckon what it will cost you to buy airfare from Chicago to New York, but try tacking on baggage fees without a cheat sheet and you’ll be at a loss.

“There is no standard,” said Alicia Jao, vice president of travel media for NerdWallet.com, which tracks travel and financial products. “That is the problem with the industry. It’s really up to travelers to figure it all out on their own.”

/conga/personal-finance/consumer_seo.html 204807 And it isn’t easy, but there are online tools available to help you navigate.

Each airline has its own set of rules and they can impact what you end up paying by hundreds of dollars. And — this won’t surprise many fliers — the rules can be quite confusing.

Some airlines will charge you the same amount for the first and second bags, while others will up the ante for the second bag and really hit you for more than three bags.

Two airlines — Spirit Airlines /quotes/zigman/5264014/quotes/nls/save SAVE +1.10%   and Allegiant Travel /quotes/zigman/101442/quotes/nls/algt ALGT +2.02%   — charge for carry-ons and bags checked at the gate, ranging from $35 to $45 with maximum weight restrictions.

Almost all airlines will sock you if the bag is a tad too heavy than the general 50-pound limit or 60-inch size. The pain is sharper if you’re traveling outside the U.S. and Canada, so pack lightly for that Caribbean beach vacation.

Before you jump on Spirit Airlines, which offers airfares you can pay for with pocket change, do the math on what it will really cost you. The discount carrier throws down a complicated set of baggage-rate rules that vary by when you pay (online versus at the airport), what you’re carrying, and whether you’re a club member or an international flier.

“Obviously, the airlines want to make money on these fees, but they also want to discourage people from bringing heavy bags,” said George Hobica, chief executive of travel site Airfarewatchdog.com. Heavier bags add more weight to the plane, which adds to fuel costs.

Baggage fees have become the gift that keeps on giving for most airlines, which continue to tinker with charges as they reap revenue, both in total dollars and as a percentage of operating income.

The fees have become such a dependable and necessary source of revenues that even Southwest Airlines /quotes/zigman/241463/quotes/nls/luv LUV +1.79%  , which has been touting “Bags Fly Free” in its ads for two years, is embracing fees already in place at AirTran Airways. (Southwest does not charge change fees, another growing revenue stream for airlines.)

Southwest, which bought AirTran Airways last May, said it will keep the baggage and change fees for AirTran — which rang up almost $167 million in the first nine months of 2011 — until 2014.

Those fees and others, including seat-assignment fees and on-board sales of food, drinks, entertainment and even pillows and blankets, add up to about 32% of AirTran’s total operating revenue.

Compare that to Spirit Airlines, which generates almost 90% of its operating revenues from such ancillary charges, and Delta Air Lines /quotes/zigman/463579/quotes/nls/dal DAL +2.98% , which rang up 24% of its operating revenues from those extras in the first nine months of 2011, the most recent figures available from the U.S. Bureau of Transportation Statistics.



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