May 3, 2012 at 2:11 PM ET
Would you pay $100 to put your carry-on bag in an airplane overhead bin? If you fly Spirit Airlines this fall and don’t pay before you get to the gate, you almost certainly will.
This week, the low-cost carrier announced that it will not only start charging a C-note for that particular privilege — the current fee is $45 vs. $30 if you pay online before you check in — but will also raise the price on roughly two dozen other baggage fees, effective Nov. 6. Depending on whether you pay those fees online, via phone or at the airport, most of the other increases are a more modest $2 to $10 per bag. Click here for a complete rundown of Spirit Air's baggage fees.
Spirit, of course, is the airline that has built its business model on charging for everything from making reservations and printing boarding passes to complying with the “unintended consequences” of government regulations. It’s a model that has earned the ire of many travelers even as it has allowed the carrier to offer low fares and maintain profitability.
“Our pricing continues to offer customers savings and time at the airport if they book their bags in advance on Spirit.com,” said spokesperson Misty Pinson. “By encouraging self-service, Spirit is able to lower our costs and pass those savings along to customers by way of low fares.”
And that $100 charge for last-minute carry-on bags? “We don’t want any of our customers to wait until they get to the boarding gate to pay for their carry-on bags as this delays the boarding process for everyone,” said Pinson. “We expect that our new $100 fee ... will ensure that customers purchase their bags before arriving at the gate.”
Other would-be customers, however, are likely to see the move as another reason to avoid the carrier altogether. Two years ago, the airline’s policies led to the creation of a Boycott Spirit Airlines Facebook page; today, the page has more than 20,000 “likes,” a number that has been growing rapidly in the two weeks since the carrier refused to provide a refund for a Vietnam veteran with terminal cancer.
Protests, however, are unlikely to sway the carrier, which has clearly found a business model that works, as evidenced by the first-quarter financial statement it released on Tuesday. During the first three months of the year, the airline’s operating revenues totaled $301.5 million, up almost 30 percent over the same period a year earlier. Profit for the quarter topped $23.4 million, up from $7.9 million the year before.
And à la carte fees played a significant role in those results. During the quarter, the airline earned $51.68 in non-ticket revenue per passenger per flight segment, up 21 percent over the year before, even as its ticket revenue dropped 6.9 percent, from $82.30 to $76.65 per passenger per flight segment.
In other words, the average Spirit passenger booking a round-trip flight paid just over $100 in add-on fees for bags, boarding passes and other ancillary services. Meanwhile, a mid-June round-trip ticket between Las Vegas and Oakland will set you back less than $82.
“It obviously works for them,” said George Hobica of AirfareWatchdog.com. “They’re profitable; they haven’t gone bankrupt, and their fares are lower than the competition. They’re going to continue to try to keep fares low, entice people to book and then hit them with the fees.”
On the other hand, says Hobica, travelers still have one fee-free card to play as Spirit’s fees for carry-on bags only apply to bags that go into the overhead bins.
“Just pack a bag that fits under the seat in front of you,” said Hobica. “If you don’t put it in the overhead bin, you don’t pay the fee.”
Rob Lovitt is a longtime travel writer who still believes the journey is as important as the destination. Follow him at Twitter.
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