Major carriers could adopt budget airline style fees
Posted on: June 2nd, 2008 by Andrew RobertsBudget airlines such as easyJet and Ryanair have been creative in recent years in discovering new ways to make money from passengers including levying fees on a variety of services from airport check in to checking a second piece of luggage. Now it appears that major carriers may join their ranks. In order to help maintain profit margins, a number of full service airlines are considering charging passengers to check-in luggage and order meals.
The suggestion came from the head of one of the biggest alliances of airlines in the world, Oneworld. Members of Oneworld include British Airways and Qantas. Accord to managing partner, John McCulloch, Oneworld and its airline members are considering changing membership rules in order to permit these kinds of budget airline-style changes.
In the past, major carriers have refrained from implementing such fees for fear of losing passengers to competing airlines. McCulloch said: “If the industry moves to a standard of charging for an apple juice in economy, the alliance will move in that direction.”
McColloch believes that the changes will not stop at charging for food and drinks on board. “Airlines would argue that it’s the right way to do it. It’s £20 a bag, £10 for a meal. We are going to see much more of that,” he said.
He added: “Airlines are going to have to find some way of combating this fuel price, whether it’s increasing fares or cutting costs, because the business is unsustainable today. People have realise that it’s going to get more expensive to travel. Fares have to rise to a realistic level to reflect the fuel price. Whether that can happen without the industry breaking up is the key question.”
McCulloch made his remarks at the annual general meeting of the International Air Transport Association in Istanbul.
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