I read an article this morning that annoyed me when I read it and the longer I think about it the more it pisses me off.
I was an airline employee for many years and I follow the National Airline History Museum on twitter. They posted an article this morning titled 5 Most Beloved US Airlines of All Time (Pan Am was first, a good choice) and a passage from it caught my eye. See below for offending paragraph.
The author was discussing whether JetBlue deserved a place on the list, and this is what prompted my anger:
Possibly, the question of whether JetBlue is beloved could be clearly answered over the next year, as the airline attempts to withstand pressure from Wall Street to do away with some of the things its passengers most love: extra legroom in coach, free Wi-Fi and a free first checked bag.So, there you have it. Every time you pay to check a bag on pretty much any airline except JetBlue and Southwest, that money is being funneled up to reward the shareholders or pay for astronomical executive salaries.
Are we at the point where Wall Street determine how many airline fees you pay? How many bank fees you pay? The constant pressure on these companies for short-term profits, greedy and appalling profits that come from the pockets of an increasingly struggling American public, outweighs the interests of the consumer.
If Wall Street gets its way and 'pressures' JetBlue to charge you $25 for your first checked bag, you'll know who to thank. And this is just one small example of how wealth is being drained from the middle and funneled to the top.
What's interesting is that in 2013 JetBlue posted record profits.
JetBlue finished 2013 with record profits, ending a period of airline earning reports that show a once struggling airline industry that appears to have found its financial footing.So this isn't about Wall Street wanting JetBlue to be solvent. It's about shareholder return, and you get to foot the bill. And one has to wonder if part of the reason for JetBlue's profitability is because they don't charge you for a single checked bag, causing passengers to choose their service over a competitor.
The carrier posted a $47 million profit in the last three months of the year, or 14 cents per share. Those results capped off what JetBlue says was its most profitable year ever, with the airline seeing an overall profit of $168 million, or 52 cents per share. In 2012, the airline reaped a $128 million profit, or 40 cents per share.
As an addendum: JetBlue configures their A320 fleet to a total of 156 seats. For a fully loaded flight, a single checked baggage charge would be $3,900 in revenue, using the standard $25 for the first checked bag. AA/DL/UA charge $35 for a second bag, so obviously the revenue would be higher on an average flight. This is still peanuts, but clearly the idea of hoovering up every dime in your pocket is so important to Wall Street that the major airlines have gladly implemented this fee.
I'll just add that the idea of paying $60 to check two bags, on top of the ticket price and other fees, is really outrageous and breathtakingly greedy. Employee wages have barely budged, fuel prices do fluctuate but that used to be covered by ticket prices. This is a fixed fee that is paid regardless.