JetBlue led the way with baggage fee increases just two months ago, going to $45 for a first checked bag paid within 24 hours of departure on February 1.
Under pressure as a financial laggard in the industry, with their plans to partner with American Airlines and acquire Spirit dashed by the Biden administration, and with activist investor Carl Icahn taking a 10% stake in the carrier and gaining board seats the New York-based carrier is trying to reinvent its business.
After announcing cuts to unprofitable routes including gutting of Los Angeles, they’re planning additional route changes. And they’re looking for additional revenue anywhere they can get it.
So they’ve increased checked bag fees again and introduced dynamic pricing for luggage.
Not only do they charge more for bags within 24 hours of departure (people will pay checked bag fees for the discount and in some cases check fewer bags, so JetBlue pockets money for bags that are never even checked) they are also taking inspiration from Wendy’s with variable pricing based on ‘peak’ and ‘off-peak’ travel.
- Prepayment saves $10
- The following dates are currently considered peak: “4/11-4/29/24, 6/20-9/3/24, 11/21-12/2/24, 12/19/24-1/6/25, 2/13-2/24/25, 4/3-4/28/25”
Southwest Airlines still includes 2 checked bags free with every ticket. JetBlue now charges more than American, United, and Delta. And since JetBlue flies in competitive markets with a focus on leisure destinations they’re making themselves price uncompetitive (more expensive to fly even when ticket prices are the same) and more opaque (harder to compare pricing across airlines) feeding the Biden administration’s efforts to regulate airlines further.
Anyone expressing outrage, though, without first calling for the tax code to stop encouraging airlines to move prices out of fares and into fees is just demagoguing and not serious. The government charges a 7.5% excise tax on domestic airfares but that doesn’t apply to fees, so U.S. airlines are saving about a third of a billion dollars in taxes by charging bag fees – and the higher they go the more tax they save.
(HT: Sam Kemmis)
Don’t love it. But there is another synergy from the business side worth considering: the JetBlue Plus card. That card is arguably a keeper card if you fly JetBlue once a year or more. The 5k points and 1 checked bag on one leg of a flight will more than pay for the card. The earn rate on that card is good. They can nickel and dime infrequent travelers, but then push people that use them into their co-branded card for the loyalty program. They really could use some more partner airlines for redemption (Qatar is nice, but availability is sparse). They need to reestablish some type of partnership with American or with Oneworld more broadly.
Again, as a consumer, these fees are always bad. From the business side, I see the appeal. The engine of profitability for all the airlines is the loyalty program. JetBlue needs to be on-time with its flights and it needs more people engaged with its program. It is possible these fees, if they don’t push people away from booking, are going to have that overall effect.
My last two flights on JetBlue pushed off on time and landed 20 minutes early. They keep doing that, people will stay for the Wifi and legroom. I really like the in-flight experience.
This is just going too far.
Jetblue is better off charging for wifi at least.
The whole bag fee thing is getting out of hand. Definitely will not be looking to travel on Jet Blue.
I think Wendy’s backtracked on their peak pricing plans.
jetBlue is a joke!
Where’s your article titled “United is shrinking so much, it will start paying pilots not to fly?” Of course you’ll never get around writing that article, only when Jetblue does it right?
This industry is a copy-cat business. I’m sure when some other airline tries a surge pricing model for bags, your laptop will be closed….and trust me, the others will adopt a similar model if they can squeeze more profits.
sell bin space up to 24 hours in advance for $50
before TSA at the airport within 24 hours; $75 for the bin, $50 to check it
no onboard tags? no onboard bags, and $100 to check it: and commission the gate agents like frontier: 50% of the take goes to the gate agents; bring a bag to the gate to big for the overhead? $100 to check it
1st checked bag: free under 30 lbs
2nd checked bag: $3 per pound
make it federal law for 121 and 135
this will put an end to bridge & tunnel packmasters transporting their entire condo to florida for 3 days
JetBlue in-flight service is the best amongst US carriers. And Mint is truly exceptional. Hoping they’ll survive and keep their service culture.
I like dynamic pricing. If I’m willing or able to travel at a time everybody else doesn’t want to, the seat I want is less valuable andf I want it to be priced accordingly.
That said, dynamic pricing for checking a bag is, well, “creative.”
Perhaps it will allow them to staff with fewer baggage handlers on off-peak times.
I would settle for a JetBlue that operates on time and doesn’t go out of business.
Will JetJoke ever get their act together, or at the very least learn to turn a profit? That airline has turned into the aviation comedy show.
What would happen if one of the big 3 US legacy carriers – I’m thinking American due to their current lack of strategy – completely abandoned the way they’ve been thinking the last 20 years and went totally premium beyond Delta. Eliminated bag fees, retrofitted aircraft to take out seats for more leg room (not just main cabin extra at the front), put abundant padding back on the seats reminiscent of the glamour days of air travel, added back complimentary hot meals in coach, and raised prices to cover it? Would they go out of business? There’s so much demand for air travel now and Delta’s strategy of premium Has shown to bring in the most revenue, and American’s stock price alone proves that they need a major overhaul in their business strategy. What do you think? They sure couldn’t get any worse than they already are.
I fly with just a carry-on in the overhead and an item under the seats, at least in the B6 markets they service from me. So no biggie,
However, this is capitalism at its finest. It will work or it won’t. They can adjust and people will adjust. Airline deregulation is still a thing and while taxes do come into play, it’s still all competition based.
Truly, I wish they would just go back with AA. I would get my AA EXP benefits on there and this wouldn’t be an issue and it’s a win all around for both companies.
If these leeches really preach about dynamic pricing then I should be paying $10 for bags on an empty flight.
I love this idea. Call me from 8-10:30 pay the discount rate. Call me on Friday from 4-5pm pay 1,000x the rate.
Two scenarios here:
– Trump wins: JetBlue sold off to AA, gates and slots divvied up among other airlines, B6 history by close of 2026.
– Biden wins: JetBlue declares bankruptcy, sold to AA, gates and slots divvied up among other airlines. B6 history by close of 2026.
Consequence of B6 dynamic baggage fee price: adopted by all airlines no matter who wins the general election.
I don’t understand the heartburn. Just simple supply and demand.
JetBlue is a private company and can charge what they want. They have a responsibility to get back to positive cash flow.
Never underestimate the American flying public’s perceived right to cheap flying.
Miserable company that can’t even do metric weights. (WTF is “lbs”?)
Hopefully, Carl Icahn can dismantle that outfit as soon as possible and sell the individual pieces for more total worth than the company as a whole.
Answering James……back in the early 2000’s American Airlines had a campaign called “More Room Throughout Coach.” They removed 3 rows of seats from all of their aircraft and spread the rest of the seats so every row had more room. They figured the seat would cost a little more, I believe back then it was on average about $20 more than their competitors, and people would value that. It didn’t work, customers still chose the cheapest price regardless of the fact that American had more room seats. Unfortunately, American had to add the three rows back to be able to compete with the other airlines. I always say this is a consumer driven product. We are where we are because people have driven the cost down by always choosing the cheapest price. Spirit Airlines caused this. If people are willing to pay more for more room then the airlines will add more room seats. Look at what’s happening with the premium seats (first class, business class). There is a high demand for these seats so airlines are adding more of them. Don’t complain about the lack of comfort when you pay $190.00 for a round trip ticket. I’m not defending the airlines but they need to make money too, it is a very low margin business.