Last week United Airlines rocked the travel industry by announcing they were permanently eliminating the $200 change fee they charge for domestic tickets. Within hours Delta, American, and Alaska Airlines joined United in dropping the fees. Basically, the airlines have made the decision to remove any obstacles from people willing to make a reservation and fly this year. Some experts think this is a temporary change. I think what will happen is that in the future basic economy fares (lowest prices but they don’t include seat assignments plus you pay for carry-ons, etc.) will also charge a change fee. Normal economy fares, which often cost $30 to $50 (one-way) more than basic economy fares, will not charge a change fee. These fares are normally purchased by business travelers who will be the biggest benefactor of the elimination of the $200 change fee. My crystal ball says that in the future if you buy the lowest priced airline ticket (basic economy) you will be subject to a $200 change fee. If you are willing to pay a little more (normal economy) you will pay a little higher price for your ticket but not pay a change fee.
Here is how I think economy (coach class) will look next year –
Basic Economy Fares Economy Fares
Seat selection for a fee Seat selection is FREE
No Priority Board Priority Boarding available
No upgrades allowed Upgrades available
$200 change fee
$75 standby fee
Actually, I think this is a very good chance that will benefit the business traveler and those willing to pay a few dollars more for differentiated service and comfort.
I am worried waiving change fees will cause airlines to increase baggage fees– I understand the three largest airlines (AA, DL, UA) generated almost $2 Billion from the $200 change fees last year. Now that they are waiving those change fees they most likely want to look at other areas where they can generate revenue. The average fee currently to check the 1st bag is $30 and the second bag is $40. I think you might see an increase in checking a bag from $30 to $40 and the second bag from $40 to $50. This might replace the billions of dollars the airlines gave up to eliminate $200 change fees. The only restraint on the airlines of further increasing baggage fees is that Southwest promotes “Bags fly Free”.
Wow! Airfare prices are as low as I have seen them in the last 10 years – This morning I went in to check what the prices were flying to multiple cities around the U.S.. I was amazed to see how low the prices have gone. Many flights are less than $200 round trip. Even flights that used to have high prices like Omaha to Cincinnati are less than half the price they used to be from last year. Obviously, the airlines want to encourage people to fly and are hoping the low prices will jolt people out of their COVID induced fear of flying. I think it might work for leisure travelers but I think business travelers might not return until 2021. Call one of our friendly travel advisors at 402-435-8888 to take advantage of these great prices.
United Airlines is adding service in October – Last week our “Fly the friendly skies” airline announced they are adding 50 new domestic flights and 23 new international flights in October. This represents about 40% of their schedule compared with October of 2019. Most of these flights are tied to their hubs of Chicago, Denver, and Houston. It also appears that they are beefing up flights to Florida and other areas that leisure travelers plan to visit this fall. Hopefully, all the low airfares will start filling some for these new flights.