American Airlines was showing that basic economy fares didn’t include a carry on bag to some customers checking in, though they hadn’t updated their website or made any announcement to this effect. That’s a restriction put in place 5 years ago and matched by United, but that American abandoned in mid-2018.
Checking in for an @AmericanAir flight (booked as a Web Special award) this morning and got some concerning pop-ups.
Seems AA is eliminating carry-on bags for basic economy.
Combined with rumors that AA is eliminating upgrades from BE, it seems some big changes are in the works pic.twitter.com/kIB6Jobebh
— JT Genter (@JTGenter) December 5, 2022
A spokesperson for the airline says they are not bringing back the ‘personal item only, no carry on’ restriction for basic economy fares and it was a mistake drawing on nearly five year old files.
We’re aware of an isolated issue in the mobile app during check-in for some customers that incorrectly displayed information about outdated information about baggage rules for Basic Economy fares. We have no plans to make changes to baggage allowances for Basic Economy tickets. We apologize for any confusion to our customers.
Frequently when something appears on a brand’s website, and is attributed to an error, it’s simply been released too early. It gets denied and then we see it implemented later. But this explanation is plausible, and the denial here is stronger than you would expect if this was a change simply release into the wild before it was intended.
Basic economy fares were pitched as ‘a new lower fare’ by most airlines, but American Airlines was always honest about what it was: new restrictions on existing lowest fares. Most people viewed it as a way to get customers to spend another $20 or $30 for the travel experience they were used to. But largely it was about customer segmentation.
Airlines could no longer use advance purchase requirements and Saturday night stays to separate out the expensive fares they sold business travelers from the cheap ones meant to fill up a plane they sold to leisure travelers. Ultra low cost carriers, and competition, eroded those practices. And that meant business travelers could get those cheap tickets without the restrictions that had discouraged them in the past.
So airlines instituted new restrictions on their cheapest fares that companies wouldn’t make business travelers buy, allowing airlines to once again price discriminate (charge much higher fares to managed corporate travelers).
However two things happened.
- The most draconian restrictions lasted only at United. Airlines with the worst basic economy lost money because customers knew the difference, that on comparable fares Delta and American offered better value.
- And then the pandemic meant there just wasn’t much managed corporate travel to segment, so American brought elite benefits back to basic economy fares and then with the move to ‘Loyalty Points’ they allowed these fares to count towards elite status.
At this point the only real restriction on American’s basic economy fares for a frequent traveler is that they aren’t changeable. That’s significant, and the end of change fees on most other fares widens the gap even further. To the extent that managed corporate travel comes back though, one does wonder whether we might see some basic economy restrictions re-emerge.