Bags Still Fly Free on Southwest

James Wang, flickr

Airline baggage fees are once again on the up and up, but one budget carrier is promising to keep prices low by steering clear of checked bag fees.

Delta Air Lines got the baggage fee ball rolling earlier this month, announcing it was hiking domestic charges to $25 for the first bag and $35 for the second, each way. United, Continental, US Airways, and American have since jumped on the baggage fee bandwagon, but Southwest is setting itself apart by refusing to gouge its customers.

The budget airline allows customers to check up to two bags for free, whereas those who travel on other major carriers would have to fork over an extra $120 for a similar roundtrip service. JetBlue is the only other major carrier who does not charge for the first checked bag, but the airline demands $30 to stow a second piece of luggage.

In the wake of the baggage fee barrage, Southwest has amped up its "bags fly free" ad campaign. One ad that ran last Sunday during the Jets v. Chargers game followed actual airline baggage workers as they loaded a plane. "I wouldn't pay to fly in here," explains one worker as he kneels in the cargo hold. Another teary-eyed worker waves to a jet as taxis down the runway, saying "see you when you get home."

Paul Flanigan, a Southwest spokesman, told the New Jersey Record the new ad campaign has been well received and earned Southwest new customers. "And when the economy rebounds, we will be well-positioned because people will remember us as the one that wasn't trying to nickel-and-dime our customers," he added.

Watch Southwest's "We Love Bags" Commercial Here:

In a report released October 12, the Dallas Morning News asked Southwest executive vice president Bob Jordan to comment on the $300-$400 million dollars the airline could be bagging per year with add on fees. Jordan told the news outlet "that doesn't take into account what business may be shifting Southwest's way because folks are beginning to get irritated with fees."

Travelers are catching onto the games airlines are playing, avoiding carriers that charge outrageous a la carte fees. The truth is in the numbers: United Airlines, the first major carrier to charge a $25 fee for a checked bag, subsequently saw a 21 percent decrease in revenue, the largest drop in the industry. Business travel writer Joe Brancatelli first noted the trend last April on his blog, Joe Sent Me, pointing out "airlines that added bag fees most quickly and on the most bags last year are exactly the ones that had the largest year-over-year revenue fall."

Continental, Delta, and American soon followed in United's footsteps, matching our surpassing United's baggage fee. Several months later, each carrier saw a 15-19 percent decline in revenue. As Brancatelli put it, "the faster they added the fees, the more their revenue fell."

During the same time period, the only major airlines that did not charge for the first checked bag-JetBlue and Southwest-saw much smaller revenue drops, 2.9 and 6.8 percent respectively.

According to the Bureau of Transportation Statistics, US carriers collected $740 million in baggage fees in the third quarter of 2009 alone. They also collected over $1.2 billion from reservation change fees, pet transportation fees, and frequent flier award program mileage sales. Delta Air Lines collected the most ancillary fees of any carrier, raking in $447.5 million in the same time period.

Before you book that great airfare deal, be aware of the extra baggage you might have to pay for. The chart below has the most up-to-date information on the prices airlines are charging for first and second checked bags on domestic flights for airport check-in, but be sure to check the rules and regulations on airline websites: some offer discounts if you pre-book online, others do not charge first class or elite passengers, and many give discounts to active U.S. military personnel.

Airline1st bag2nd bag
United Airlines$25$35
US Airways$25$35
Virgin America$15$15
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