The Wall Street Journal-20080205-Another Reason Not to Overpack- United to Charge Some Fliers --36-25 per Extra Checked Bag- Others Consider Similar Move

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Another Reason Not to Overpack; United to Charge Some Fliers $25 per Extra Checked Bag; Others Consider Similar Move

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Bucking convention, United Airlines plans to charge passengers buying its cheapest, nonrefundable tickets for domestic and Canadian flights $25 to check a second piece of luggage -- unless the travelers have elite status in its Mileage Plus frequent-flier program.

Until this change, all United passengers could check two 50-pound suitcases free of charge, the industry standard except for at a few discount carriers such as Spirit Airlines Inc. and Skybus Airlines. United's move, which some other full-service airlines said they are studying, could lead to a shift if rivals follow suit -- another step down the path of charging passengers for products and services such as meals, curbside check-in and advance seat assignments that once were complimentary.

United parent UAL Corp., the nation's second-largest airline by traffic after AMR Corp.'s American Airlines, estimated the change will generate more than $100 million annually in cost savings and new revenue. Currently one in four of its passengers checks a second bag, United said.

United and other airlines are struggling with high fuel prices and haven't, for competitive reasons, been able to raise prices enough to offset that growing expense. They are trying to trim expenses to keep fares low but are also looking for new revenue by offering products and services passengers are willing to pay for, a practice known as unbundling.

David Stempler, president of the advocacy group Air Travelers Association, said he has mixed feelings about the change, but thinks other airlines will match United's luggage policy. "Passengers have told them they won't pay higher fares," he said.

"If you can charge for food, you can charge for a bag," said Bob Harrell, an airline-pricing expert for Harrell Associates.

But if other airlines don't follow suit, United could start to lose business among price-sensitive, nonelite frequent fliers and decide to roll back the rule change, he said. Other potential drawbacks: determining passengers' mileage status and ticket types could require more interaction with airline agents, and the new rules might encourage passengers to carry more luggage into already crowded cabins.

A United spokeswoman said the company has done the research and is confident this is the right approach. The new policy applies to nonrefundable tickets purchased starting yesterday for travel starting May 5 on flights within the U.S., and to Canada, Puerto Rico and the U.S. Virgin Islands. United also plans to double the fee for overweight luggage to $100 per bag from $50 on May 5, and intends to charge $100 per bag to carry as many as four additional suitcases, instead of the old fees that ranged between $85 and $125 per piece. (A bag is considered overweight if it is more than 50 pounds.)

Not affected will be fliers who have logged at least 25,000 miles on United last year, giving them "Premier" status or higher in its mileage plan, and people traveling with them on the same reservation. Travelers who purchased more costly refundable tickets, people traveling in first and business class and on military and government fares also will be exempt. Car seats, strollers and wheelchairs don't count as second pieces of luggage.

American declined to comment on United's move. So did Delta Air Lines Inc., citing a policy of not discussing future fee changes. US Airways Group Inc., and Northwest Airlines Corp. said they are studying it. "We're in the process of reviewing it," said a Northwest spokeswoman.

Alaska Air Group Inc.'s Alaska Airlines said it is monitoring industry practice but doesn't intend to change its current baggage policy. Discount king Southwest Airlines Co. last month started charging $25 for a third checked bag in place of letting customers bring three bags free of charge. But a spokesman said Southwest doesn't anticipate charging for the first two pieces, if they aren't overweight.