Wednesday, February 6, 2008

The Cost of Luggage

"You’ve probably already heard the news that United plans to start charging the majority of its customers $25 for the second piece of checked luggage on domestic U.S. and Canadian flights. You can check out their new policy here. This comes as no surprise to airline insiders and follows the “successfully introduced” industry-wide reduction of individual suitcase weights to 50 lbs/23 kg from 70 lbs/32 kg. While many issues surely factor into this move (increased handling due to security concerns, lost/misplaced luggage rates, corner-cutting on staffing), airlines cite the rise in fuel costs for the need to start charging you more. It is estimated that this change will save/earn United over $100 million per year. "

"When it directly impacts your pocketbook, are you more conscious of how much you pack? The idea behind these additional fees is largely a textbook lesson in rational economic decision-making. Nevertheless, these two airlines with their completely different business models also have radically different reasons why they’re charging you for the handling of your suitcase. "

"United is banking less on deterring passengers from carrying a second suitcase (which it will undoubtedly do for some fliers, resulting in airline savings for luggage handling costs, fuel costs and improved lost/misplaced luggage rates) and more on the continued heavy packing habits of many Americans, earning an extra $50 for each round-trip purchased by 1 in 4 vacationers. For those who absolutely must have that second bag (heading to college, moving in general, Christmas gifts, whatever), a $25 fee is still likely to be cheaper than the shipping costs for a 50 lb suitcase."

This info came from nobudgettravel.wordpress.com

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