EPTAmerican Airlines rolls out fee for coach seats
August 18, 2010 6:36 p.m. EDT
(CNN) -- Even the cheap seats are getting pricey.
On Wednesday, American Airlines announced an add-on fee for the front rows in coach class.
The fee is the latest in a long line of a la carte airline fees that have brought billions in revenue to legacy airlines hobbled by high oil prices and economic recession.
American's new Express Seats will start at $19 per flight for choice spots in the first few rows in the cabin. Passengers who opt for designated Express Seats will board in the first group of general boarding, likely reducing the amount of elbow jockeying for overhead space.
"Express Seats highlights American's focus on offering customers what they value most," Virasb Vahidi, the airline's chief commercial officer, said in a statement.
Jami Counter, senior director of TripAdvisor flights, begs to differ.
"The Express Seats option is really a way for American Airlines to introduce a new fee that basically charges extra for regular coach seats," he said.
Despite offering a faster way on and off the plane, Counter sees little value in the option.
"A better strategy would be to just buy the carrier's optional Group 1 boarding fee on a standalone basis for $20 round-trip," he said. That option is part of a new suite of unbundled services that American introduced in June called the Your Choice program.
Fees for Express Seats, which include bulkhead seats, are based on distance, starting at $19 for shorter distances up to $39 for a cross-country itinerary. Express Seats will be available only via the airport self-service check-in machines from 24 hours to 50 minutes before departure for flights in the United States, including Puerto Rico and the U.S. Virgin Islands.
The airlines have been clever in finding ways to unbundle options and services in a way that doesn't affect the base fare, Counter said. The traveling public is particulary sensitive to fare increases, so the airlines keep fares lower and make final cost comparisons across airlines difficult.
Industry watcher Joe Brancatelli sees the new fee as another reason travelers are likely to choose discount carriers Southwest and JetBlue.
"This is just the legacy carriers continuing to blow their brains out," said Brancatelli, who runs JoeSentMe.com, a website for business travelers.
"Every one of these things makes prices more complex and convoluted, and the last thing that customers want is complex and convoluted."
Despite the tangle of fees, most major U.S. carriers, with the exception of American Airlines, reported second-quarter profits. But most are still sitting on a mountain of debt, Counter said.
"I think they're trying to get to a long-term sustainable business model where they're not quite as susceptible to these continuous cycles, whether it be oil spikes of something like the swine flu," he said.
But Brancatelli points out that the legacy carriers are losing market share and overall revenue, despite gains in recent months, and their route networks are shrinking.
"Instead of doing what the profitable airlines do, which is simplify the ticket buying process, they continue to make it more complex, going after a tiny revenue stream while they're gushing," Brancatelli said.
"The big picture shows that they're losing the game," he said.
(CNN) -- Even the cheap seats are getting pricey.
On Wednesday, American Airlines announced an add-on fee for the front rows in coach class.
The fee is the latest in a long line of a la carte airline fees that have brought billions in revenue to legacy airlines hobbled by high oil prices and economic recession.
American's new Express Seats will start at $19 per flight for choice spots in the first few rows in the cabin. Passengers who opt for designated Express Seats will board in the first group of general boarding, likely reducing the amount of elbow jockeying for overhead space.
"Express Seats highlights American's focus on offering customers what they value most," Virasb Vahidi, the airline's chief commercial officer, said in a statement.
Jami Counter, senior director of TripAdvisor flights, begs to differ.
"The Express Seats option is really a way for American Airlines to introduce a new fee that basically charges extra for regular coach seats," he said.
Despite offering a faster way on and off the plane, Counter sees little value in the option.
"A better strategy would be to just buy the carrier's optional Group 1 boarding fee on a standalone basis for $20 round-trip," he said. That option is part of a new suite of unbundled services that American introduced in June called the Your Choice program.
Fees for Express Seats, which include bulkhead seats, are based on distance, starting at $19 for shorter distances up to $39 for a cross-country itinerary. Express Seats will be available only via the airport self-service check-in machines from 24 hours to 50 minutes before departure for flights in the United States, including Puerto Rico and the U.S. Virgin Islands.
The airlines have been clever in finding ways to unbundle options and services in a way that doesn't affect the base fare, Counter said. The traveling public is particulary sensitive to fare increases, so the airlines keep fares lower and make final cost comparisons across airlines difficult.
Industry watcher Joe Brancatelli sees the new fee as another reason travelers are likely to choose discount carriers Southwest and JetBlue.
"This is just the legacy carriers continuing to blow their brains out," said Brancatelli, who runs JoeSentMe.com, a website for business travelers.
"Every one of these things makes prices more complex and convoluted, and the last thing that customers want is complex and convoluted."
Despite the tangle of fees, most major U.S. carriers, with the exception of American Airlines, reported second-quarter profits. But most are still sitting on a mountain of debt, Counter said.
"I think they're trying to get to a long-term sustainable business model where they're not quite as susceptible to these continuous cycles, whether it be oil spikes of something like the swine flu," he said.
But Brancatelli points out that the legacy carriers are losing market share and overall revenue, despite gains in recent months, and their route networks are shrinking.
"Instead of doing what the profitable airlines do, which is simplify the ticket buying process, they continue to make it more complex, going after a tiny revenue stream while they're gushing," Brancatelli said.
"The big picture shows that they're losing the game," he said.
Source: http://www.cnn.com/2010/TRAVEL/08/18/new.airline.fees/index.html?iref=NS1
So, after reading that, I dropped my jaws. It seems like the airline business got caught up with how mmorpgs or game companies work their fees on things. Seeing how nowadays, we have facebook 2.0, b.net 2.0, TL 2.0 (see banner), could this possibly be Airlines 2.0? And you know what happens, one company makes a brilliant scheme to make more money, all other companies follow and pursue the exact same thing except they'll claim their "methods" are better, effective or something.... and before you know it, every single airline will begin charging to use the bathroom or food and hell even seatbelts... The beginning of the end....
