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My Theory: Why Delta and Other Airlines Jump on the Baggage Fee Bandwagon (And Ways You Can Avoid It)

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My Theory: Why Delta and Other Airlines Jump on the Baggage Fee Bandwagon (And Ways You Can Avoid It)

Devon O'RourkeMy Theory: Why Delta and Other Airlines Jump on the Baggage Fee Bandwagon (And Ways You Can Avoid It)Million Mile Secrets Team

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Delta, United Airlines, American Airlines, JetBlue, and others are have recently elected to raise baggage fees.  And in a miraculous head-scratching effort, the majority of airlines raised their prices by same amount, most up to $30 for the first bag.

I know what you’re thinking.  Why do most airlines raise their prices at the same time and by the same rate?  And how can I avoid the higher prices?

I’ll tell you.  And you can subscribe to our newsletter if you want more money-saving travel tricks.

Why Delta and Other Airlines Jump on the Baggage Fee Bandwagon and Ways You Can Avoid It
Why Delta and Other Airlines Jump on the Baggage Fee Bandwagon and Ways You Can Avoid It

Let’s walk through it together.

Delta, United Airlines, and Others Join the Baggage Fee Bandwagon

In late summer of 2018, JetBlue announced a baggage fee increase of $5.  In the 3 weeks following, Delta, United Airlines, American Airlines, and WestJet were quick to announce the same exact change.

Airlines executives claim that the airline industry saw rising fuel prices and that this was a healthy response to bring more revenue back to the industry.

But doesn’t it seem odd that most airlines changed their tune all within a month’s time frame?  I’ve got a couple theories on why this occurs. 🙂

Theory 1:   Oligopoly

Domestic US Airlines operate within what some say is an oligopoly.  It’s like a monopoly but instead of 1 major player controlling the market, you have a few.  Think of Fluffy, the 3-headed dog from Harry Potter, where each airline is a head.  Each head (airline) has some self-control but is ultimately tied to the same body (market).

So when critical movements and practices are adopted, you see all the major players adopting the new policy.

Take Basic Economy for example:   It was practically non-existent a few years ago.  And then poof!  Every airline is suddenly offering a form of Basic Economy.

Why Delta and Other Airlines Jump on the Baggage Fee Bandwagon and Ways You Can Avoid It
Much Like These Stick Figures, Airlines Generally Follow the Same Path as Each Other

Delta was one of the first airlines to offer Basic Economy.  It’s a stripped down version of economy where you generally can’t pick your seat, you forfeit certain refund rights, and simply remove the “conveniences” of economy for a lower ticket price.  Soon after, other major airlines followed suit, and now Basic Economy is everywhere.

Big moves like introducing Basic Economy and rising baggage fees do not succeed in an oligopoly unless every player adopts the new practice, hence the Baggage Fee Bandwagon!  Plus, why wouldn’t airlines want to jump on the opportunity to make more revenue while creating more options for their customers?

Which leads us into the next theory.

Theory 2:   Un-Bundling

Un-bundling is a trend.  Remember how cell phones started large, then got realllllllly small, and are now large again?  Well, that’s how I think un-bundling is going to play out.

Un-bundling is the act of removing core elements from a package, effectively creating an A La Carte menu.  So in this case, an airline ticket and its features are the package.  Depending on the airline, the features that come with a ticket could be a seat assignment, a drink, Wi-Fi, a carry-on, a checked bag, etc.

Why Delta and Other Airlines Jump on the Baggage Fee Bandwagon and Ways You Can Avoid It
Un-bundling is a Trend Where Airlines (Hopefully) Reduce the Cost of Tickets by Charging Separately for Things Like Carry-Ons

This un-bundling trend removes things like carry-ons from the base price of an airline ticket and charges a separate cost for the carry-on.  So, a customer who doesn’t need to pay for a carry-on can get the “same” ticket at a marginally cheaper rate.  Sounds like a good deal, right?

Maybe.  There hasn’t been significant data to show that Basic Economy is, in general, cheaper than regular coach.  Some even think Basic Economy is a clever way to raise coach fares.

In any event, it’s a move that almost all major airlines have adopted in some form or fashion.  The Un-bundling Bandwagon?  Doesn’t quite have the same ring to it 😉

How to Hop Off the Baggage Fee Bandwagon

There are 2 easy ways to hop off the Baggage Fee Bandwagon

  • Fly an airline that has free checked bags
  • Hold an airline-branded card that offers free checked bags!

Southwest, the King of Free Checked Bags

Need one or two free checked bags?  Southwest has you covered.  Everyone who flies Southwest gets 2 free checked bags!

Airline-Branded Credit Cards Like the AMEX Delta Cards

Another easy way to avoid baggage fees is to have an airline-branded credit card, like the Gold Delta SkyMiles® Credit Card from American Express.  These types of cards give you at least 1 free checked bag.  Some airline credit cards even give up to 8 companions booked on the same itinerary free checked bags, too!  That could be worth hundreds to a large family flying round-trip.

Read here to learn 6 ways to avoid checked baggage fees!

I personally use the Citi® / AAdvantage® Platinum Select® World Elite™ Mastercard® to save $120+ every time my fiance and I fly round-trip and need to check bags with American Airlines.

Bottom Line

Airlines raise the prices of things like baggage fees by the same rate and around the same time as each other.  We’re dubbing this the “Baggage Fee Bandwagon.

But you don’t have to join the bandwagon!  I personally fly Southwest which gives me up to 2 bags free.  I also have the Citi AAdvantage Platinum Select card to save on checked bag fees for me and up to 4 companions on American Airlines domestic itineraries!

Have you noticed airlines tend to raise their prices for checked bags at the same time?  Share your method of staying off the bandwagon!  And subscribe to our newsletter below:

Gold Delta SkyMiles® Credit Card from American Express

Gold Delta SkyMiles® Credit Card from American Express

  • Earn 30,000 Bonus Miles after you use your new Card to make $1,000 in purchases within your first 3 months and a $50 Statement Credit after you make a Delta purchase with your new Card within your first 3 months.
  • Earn 2 miles for every dollar spent on eligible purchases made directly with Delta. Earn one mile for every eligible dollar you spend on purchases.
  • Check your first bag free on Delta flights – that’s a savings of up to $240 per round trip for a family of four.
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Editorial Note: We're the Million Mile Secrets team. And we're proud of our content, opinions and analysis, and of our reader's comments. These haven’t been reviewed, approved or endorsed by any of the airlines, hotels, or credit card issuers which we often write about. And that’s just how we like it! :)

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The bottom line is their bottom line PERIOD. They can call it whatever they want or give whatever excuse they want but they do it for money alone.