Northwest has played follow the leader introducing a $15 1st checked bag fee on tickets sold beginning tomorrow for travel beginning >>. Elites and full fare passengers are exempt from the fee.
But they also dropped a bomb. They’re imposing “fuel surcharges” on all award tickets issued on or after September 15th. $25 for flights within North America, $50 transatlantic, $100 transpacific, $75 intra-Asia (unless travel originates in Hong Kong, in which case it’s $44), and $50 on all other itineraries.
Of course, fuel surcharges are just part of the price of a paid ticket and have nothing to do with fuel per se.
But just as I predicted in January, the allure of fees is just too compelling. Merger suitor Delta announced this sort of fee two weeks ago. They somehow believe it’s free money waiting to be picked up, that their members are invested in the program and of course you can’t really redeem your miles and get decent value out of them anywhere else. So customers are stuck, and there are tens of millions of dollars to be made here.
Only if other airlines somehow do not follow — hardly a trait to rely on in this industry — then they could have a real competitive advantage among members and that’s meaningful, not just because they’ll attract paying passengers when they’re needed most for the airline but because they’ll protect and enhance the value of their frequent flyer programs… which are the only asset making money for the airlines these days.
Remember the lesson I outlined several days ago: Fixed fees for award travel mean you shouldn’t redeem those miles for coach travel.