American Airlines raises bag fees, won't allow some travel agency bookings to earn miles

An American Airlines plane sits at the gate at Cancun International Airport on May 26, 2023.

Daniel Slim | AFP | Getty Images

American Airlines has raised the price to check a bag for the first time in more than five years and said it would limit which travel agency bookings are eligible to earn frequent flyer miles.

Passengers will pay $35 to check a first bag for domestic flights if the service is booked online in advance, or $40 if they purchase the option at the airport, the carrier said Tuesday. Both options previously cost $30. A second checked bag will cost $45, up from $40, whether purchased in advance or at the airport.

Travelers’ first checked bag on flights between the U.S. and Canada, the Caribbean or Mexico will be $35 whether in advance or at the airport.

American Airlines last raised bag fees in September 2018 along with other major airlines. Carriers are looking for ways to increase revenue as airfare has declined over the past year. The last inflation report showed airfare fell more than 6% in January from a year earlier.

“Our cost of transporting bags is significantly higher” over the past few years, said Scott Chandler, American’s senior vice president of revenue management and loyalty. “Fuel is a big component of it.”

Airlines and other companies have been grappling with how to cover higher costs, like new labor contracts, while pricing power has waned.

Other airlines have also recently raised bag fees. This year, Alaska Airlines increased the charge for economy passengers to check bags by $5 to $35 for a first piece and $45 for a second bag. JetBlue Airways started charging most coach travelers $45 to check a bag within 24 hours of departure, up from $40. In advance, JetBlue is now charging $35 for the first bag.

United Airlines declined to comment Tuesday on potential changes to its policy, and Delta Air Lines didn’t immediately comment.

In the first nine months of 2023, U.S. airlines brought in $5.5 billion from baggage fees — including more than $1 billion by American alone. The total was up 9% from the year-earlier period, and up more than 25% from the first nine months of 2019, according to the Transportation Department’s latest data.

American’s frequent flyer members with elite status and some American Airlines credit cardholders will still receive a complimentary checked bag, it said Tuesday in announcing the changes.

The Forth Worth, Texas-based airline is also reducing fees for slightly overweight bags, so travelers will no longer have to frantically remove items from their suitcases at the check-in counter. For example, customers will pay a fee of $30 on checked bags that are as much as three pounds over a 50 pound limit, instead of the previous $100 fee.

American also said on Tuesday that it will start limiting which tickets purchased through a third party are eligible to earn AAdvantage frequent flyer miles, a move that aims to drive traffic to American’s website and the latest in a series of changes to the program. It said it will provide a list in April of preferred travel agencies whose bookings will still be eligible for the rewards credits.

Customers who buy basic economy tickets will only earn frequent flyer miles if they book on American Airlines’ website.

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Source: https://www.cnbc.com/2024/02/20/american-airlines-raises-bag-fees-limits-miles-for-travel-agency-bookings.html

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