CHARLOTTE, N.C. -- In announcing that it will accept the inevitable and add a first-bag fee,
offered a glimpse into airline passenger psychology.
Five months ago,
unit American introduced the concept, saying it would charge passengers $15 to check a first bag. It took time, but gradually all six legacy carriers signed on. The last one, before Delta, was
, which added the fee in October.
Delta had thought it might benefit by holding itself out as a carrier that eschewed the fee.
did the same, mounting an advertising campaign boasting "Low Fares (and) No Hidden Fees."
But Delta's holdout proved pointless. "The increase in bags being carried on board Delta aircraft this year tells us that customers are not differentiating Delta as the only major airline not charging for a first checked bag," said Delta Chief Operating Officer Steve Gorman, in a prepared statement.
In other words, passengers were carrying more bags onto Delta flights because they falsely perceived that Delta had added the same fees its peers had.
One possible conclusion here is that no good deed goes unpunished. Another is that while people may like to complain about airlines charging fees for bags and other extras, they are paying them anyway.
As Gorman noted, "As we align customer policies and fees to simplify the travel experience for our customers throughout the merger, Delta is adopting proven practices from both Delta and Northwest that have been broadly accepted in the marketplace." Delta added the fee as it moved to coordinate policies with Northwest, which it acquired last week.
Combined with unprecedented capacity cuts, fees for baggage and other services are helping to boost the airline industry's fortunes. Expectations for a profitable 2009 are becoming widespread, despite the troubled economy.
, for instance, says new fees will likely boost next year's revenue by $750 million.
projects a revenue gain of $400 million to $500 million.
Additionally, the new fees have led to a new industry model where passengers pay for services they use while airlines handle less baggage and, in the case of US Airways, which charges for drinks -- fewer drinks. In September, the number of checked bags on US Airways fell by 25%. "We've stumbled onto a better product," Parker said, in an interview.
With all the legacy carriers signed on to bag fees, attention may shift to the low-fare carriers. Southwest seems wedded to the policy it has so heavily advertised, but clearly
On the AirTran third-quarter earnings conference call, CEO Bob Fornaro noted that the carrier has looked at adding baggage fees. "We have elected not to, primarily because our largest competitor in Atlanta hasn't done it," he said. "We compete on two-thirds of our flights and 80% to 90% of our revenue. We prefer to be a follower in this situation rather than a leader."
If Delta were to add a first bag fee, Fornaro said, "we would strongly consider it."