TheRustyScupper
09-05-2008, 04:23 PM
09/05/08-DALLAS - Continental Airlines Inc. said Friday it is charging some coach customers $15 for a first checked bag, matching a similar fee imposed by most other major U.S. carriers.
A company spokeswoman said the fee would help offset high fuel costs, which have caused Continental and other carriers to lose money this year.
The fee took effect immediately on tickets for travel in the United States and Puerto Rico, the U.S. Virgin Islands and Canada for travel starting on Oct. 7 or later.
Bags that exceed weight and size restrictions could be subject to additional fees, the airline said.
Houston-based Continental said the fee wouldn't apply to elite members of its frequent-flier program, those in first- or business-class seats, customers traveling on full-fare economy tickets, or military personnel and their families traveling on official orders.
Most U.S. airlines charge customers who check more than one piece of luggage.
Among major carriers, AMR Corp.'s American Airlines, the nation's largest carrier, was the first to impose a fee for the first checked bag, beginning in June. AMR Chairman and Chief Executive Gerard Arpey conceded his airline took "a little bit of flack" for the fee.
Continental's decision leaves Atlanta-based Delta Air Lines Inc. as the only holdout among the six so-called legacy carriers, and Southwest Airlines Co. also doesn't charge for the first bag.
Continental Chairman and CEO Lawrence Kellner said this summer his airline was watching how the fee worked at other airlines — whether it caused delays in boarding — and whether customers would rather pay a fare increase than face a bunch of fees.
"My general view is if those people need a product, how do we put that in an all-inclusive fare?" he said at the time.
But in the nearly three months since American's fee took effect and other carriers began matching it, it hasn't seemed to sway customers.
"We thought we would see more of a market shift by not having the fee," Continental spokeswoman Julie King said Friday. "So we feel it's the right competitive move" to charge for a first checked bag.
King said the fee would help offset fuel costs that remain high despite the recent decline in oil prices.
Rick Seaney, CEO of airfare research site FareCompare.com, said customers are bothered by fees but "have a high threshold for air-travel pain."
Seaney said travelers are responding to the first-bag fees by carrying more stuff on board — which is still free — and packing lighter, "mainly because their choice of airlines and flight times is getting more limited every day."
Continental declined to say what percentage of its customers would likely be charged the fee. American, which also waives the fee for many loyal customers, estimated it covered about one-fourth of its summer travelers.
Continental also didn't give an estimate of how much it hopes to raise from the charge. The company has lost $83 million in the first half of the year after two straight profitable years, and it's cutting 3,000 jobs and reducing U.S. flights this fall.
NOTE: Red-Bold emphasis supplied by OP.
A company spokeswoman said the fee would help offset high fuel costs, which have caused Continental and other carriers to lose money this year.
The fee took effect immediately on tickets for travel in the United States and Puerto Rico, the U.S. Virgin Islands and Canada for travel starting on Oct. 7 or later.
Bags that exceed weight and size restrictions could be subject to additional fees, the airline said.
Houston-based Continental said the fee wouldn't apply to elite members of its frequent-flier program, those in first- or business-class seats, customers traveling on full-fare economy tickets, or military personnel and their families traveling on official orders.
Most U.S. airlines charge customers who check more than one piece of luggage.
Among major carriers, AMR Corp.'s American Airlines, the nation's largest carrier, was the first to impose a fee for the first checked bag, beginning in June. AMR Chairman and Chief Executive Gerard Arpey conceded his airline took "a little bit of flack" for the fee.
Continental's decision leaves Atlanta-based Delta Air Lines Inc. as the only holdout among the six so-called legacy carriers, and Southwest Airlines Co. also doesn't charge for the first bag.
Continental Chairman and CEO Lawrence Kellner said this summer his airline was watching how the fee worked at other airlines — whether it caused delays in boarding — and whether customers would rather pay a fare increase than face a bunch of fees.
"My general view is if those people need a product, how do we put that in an all-inclusive fare?" he said at the time.
But in the nearly three months since American's fee took effect and other carriers began matching it, it hasn't seemed to sway customers.
"We thought we would see more of a market shift by not having the fee," Continental spokeswoman Julie King said Friday. "So we feel it's the right competitive move" to charge for a first checked bag.
King said the fee would help offset fuel costs that remain high despite the recent decline in oil prices.
Rick Seaney, CEO of airfare research site FareCompare.com, said customers are bothered by fees but "have a high threshold for air-travel pain."
Seaney said travelers are responding to the first-bag fees by carrying more stuff on board — which is still free — and packing lighter, "mainly because their choice of airlines and flight times is getting more limited every day."
Continental declined to say what percentage of its customers would likely be charged the fee. American, which also waives the fee for many loyal customers, estimated it covered about one-fourth of its summer travelers.
Continental also didn't give an estimate of how much it hopes to raise from the charge. The company has lost $83 million in the first half of the year after two straight profitable years, and it's cutting 3,000 jobs and reducing U.S. flights this fall.
NOTE: Red-Bold emphasis supplied by OP.