Passengers are starting to pay extra for more legroom, Wifi, early boarding
Additional fees for services such as checked baggage, refreshments and pillows gave the airline industry around $22 billion, or 5% of global industry revenue, in 2010. Now carriers are looking at other ways to charge passengers for things they may have received free-of-charge in the past – seats that recline further, selecting a seat, gourmet foods and champagne, insurance against adverse weather conditions, fast security, early boarding and so on.
Airlines are only “scratching the surface” with baggage and seat fees, says one insider. They could even become virtual shopping malls, offering the captive passengers a range of “buy-while-they-fly” items such as accessories, toiletries or tickets for performances at the destination. Some low-cost carriers derive 20% of their revenue through ancillary sources, compared to international airlines like SAS and BA where only 3% comes from ancillary revenue.
American and United Airlines are already selling early boarding to frequent fliers using economy class, something that has become sought after now that more passengers carry larger bags on board with them. Seating in Delta’s forthcoming new “economy comfort” zone, which offers 10cm more legroom and 50% more recline, will cost an additional $80 to $160 each way. Delta also charges $5-$13 for Wifi access. Jetblue passengers can watch new movies for a fee of $6. Southwest passengers can pay $10 for early access to seats. Airlines are clearly moving to flights where passengers can customise their trips.
The Wall Street Journal
[pictured: Qantas A380 economy snack bar designed by Marc Newson]