Airlines quietly prepare a carry-on bait and switch
Updated June 17, 2015 12:05 PM
By ADAM MINTER, Bloomberg View as printed in newsday.com
The days of watching a fellow airline passenger hold up a flight as he tries to stuff a suitcase into a packed overhead bin might soon be over. Last week, the International Air Transportation Association, an airline trade association representing 83 percent of global air traffic, announced a new guideline that reduces the “optimum” size of a carry-on bag by the volume equivalent, in Quartz’s estimation, of four soccer balls.
If it works as planned, IATA promises that “everyone should have a chance to store their carry-on bags on board aircraft of 120 seats or larger.” That’s a worthy goal, but achieving it is likely to cost the flying public far more than the price of a new bag. As currently crafted, IATA’s rules would induce more customers to check bags — and pay the associated fees, which represent one of the airline industry’s most lucrative sources of revenue.
It should be no surprise that nine carriers have already embraced the voluntary guidelines, with other “major international airlines,” as IATA’s press release put it, planning to join them. It’s easy to forget that the practice of paying for checked bags on legacy airlines only started in 2008. Carriers justified the fees by pointing to high oil prices. (Those were the days crude oil was selling for $140 per barrel.) But when oil prices dropped, airlines not only didn’t roll back the fees, they raised them. They’ve since become an inextricable part of the industry. In 2014, U.S. airlines earned $3.5 billion from checked baggage fees– a sum equal to 23.9 percent of the $14.6 billion pre-tax operating profit that U.S. airlines earned that year.
The impact of this business model was felt most acutely in the economy class cabin, where the overhead compartments began to fill with bags that would have previously been checked. Airlines compounded the problem through their profit-driven determination to jam more seats onto planes — leading to yet more bags crammed overhead.
But the additional profits eventually came at a cost for airlines — and not just in the form of miserable passengers. As more bags moved into the cabin, the boarding process grew longer and delays ensued. According to the New York Times, in 2011 it took 30 to 40 minutes to board 140 passengers on a domestic flight; during the 1970s it took around 15 minutes. Those extra minutes on the ground cut into the time those planes were able to earn money by flying routes through the air.
Spirit Airlines, the budget airline that pioneered checked bag fees, solved its delay problem by charging for carry-on bags starting in 2012. According to the airline, this simple measure has reduced boarding and deplaning times “by an average of more than six minutes,” in large part by “virtually eliminating” the need to check bags at the boarding gate.
Many of America’s legacy airlines would probably have liked to follow Spirit’s lead. In recent years, they’ve “unbundled” other perks, from meals to movies, that were once included in standard fares. But until now, at least, they had balked at charging for carry-on bags, perhaps in the belief that passengers would protest paying a premium ticket price for services that were scarcely distinguishable from those of budget airlines.
The beauty of IATA’s new guideline for smaller carry-on bags is that it allows airlines to avoid charging their customers a new fee, while increasing the likelihood those passengers will pay the existing fees for checked bags. It’s a lousy deal for consumers, but that’s unlikely to dissuade airlines from eventually signing up for it. And IATA’s involvement in setting the guidelines offers cover if anyone complains: Airlines can claim they’re simply following recommendations from an organization that also sets safety standards.
There are alternative methods for speeding up the boarding process that airlines should probably consider. Delta Airlines, for example, is expanding an experiment whereby valets pre-board carry-ons for passengers (who enter the cabin to find them neatly stowed above their seats). It would also be worth trying the allegedly optimal boarding procedures recently devised by a pair of U.S. mathematicians.
In the end the most just and efficient procedure might be to do what the legacy airlines have long avoided: charge for the carry-ons. That would accomplish airlines’ two goals — reducing delays and increasing profits — in maximally transparent fashion. If airlines wanted to make the charges slightly more palatable, they could agree to reduce the cost of a checked bag and thereby create an incentive to stuff all your stuff into the cargo hold anyway. Either way, the passengers lose. But this way, they would lose less.