DALLAS ( TheStreet) -- Spirit Airlines said it will become the first carrier to charge for carry-on bags, largely because it wants to reduce boarding delays.
The privately-held carrier's new bag policy was announced Tuesday in conjunction with a reduction in ticket prices, with Spirit's lowest fares falling by $40. Passengers can still carry on a first item free, as long as it fits under the seat. For example, a small gym bag, a computer bag, or a coat would be free, but carrying on a roller board would trigger a fee.
Effective for flights departing Aug. 1 and later, the basic fee is $30 per bag. The charge rises to $45 if a passenger pays at the gate, a time-consuming process the airline hopes to discourage. The charge falls to $20 if a passenger pays $9 to join its "$9 Fare Club," which provides access to the lowest priced tickets.
"We don't think anyone loses in this," said CEO Ben Baldanza, in an interview. "The fares are coming down by over $40. If you carry on a bag, you will pay for it, but you will pay less than you pay today. If you don't carry on a bag, you pay less for your ticket."Baldanza said Spirit offers a far better deal than the Southwest (LUV) "bags fly free" offer, which he termed "disingenuous." On Southwest, he said, "bags don't really fly free. If you don't check a bag, you are still paying for those who do. Southwest won't give me a discount if I don't check a bag." The policy of charging for checked bags,
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV