Capitulation: American Airlines Admits Its Basic Economy Fares Aren’t Working

airplanes parked at an airport

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While there are few things more annoying than an airline introducing new measures under the guise of “passenger improvements”, there are few things more pleasing than seeing that same airline forced into backtracking on those measures. This time it’s American Airlines looking more than a little sheepish.

American Airlines (and other legacy carriers) introduced “Basic Economy” fares as a new way to nickel and dime passengers and to force people to pay more for the benefits they were used to receiving.

Naturally this isn’t how Basic Economy fares were marketed to the general public. Taking us all for idiots the airlines attempted to portray Basic Economy fares as a new option which would make flying cheaper and more accessible.

In reality, the likes of American and United Airlines used Basic Economy fares to make flying miserable in an attempt to get passengers to pay more just so they didn’t have a Basic Economy experience.

a row of seats in an airplane

As things stand, passengers booking Basic Economy fares on American Airlines board in the final boarding group (unless they have elite status or a credit card that says otherwise) and can only travel with a small personal item that fits under the seat ahead of them.

Basic Economy passengers do not have access to the overhead bins on American Airlines aircraft.

Just think about that for a moment.

If you buy a Basic Economy fare on American Airlines you’re essentially expected to be able to travel with little or no luggage…..and it’s not like Basic Economy fares are any cheaper than the lowest fares available before Basic Economy was introduced!

American Airlines management clearly believed that this draconian restriction would encourage (force) customers to pay more for fares which offer a proper hand baggage allowance and therefore drive revenues upwards…..but apparently that’s not what’s been happening.

Airlines like Delta don’t have a draconian hand baggage policy for passengers buying Basic Economy fares and airlines like Southwest still offer all passengers free checked bags as well as a regular hand baggage allowance….so flyers have had other options available to them.

Based on the latest news out of American Airlines it would appear as if passengers have been exercising those options.

seats in an airplane with windows

American Airlines has announced that, from 5 September 2018, it will reintroduce a regular hand baggage allowance for passengers booking Basic Economy fares.

Here’s American’s reasoning for the backtrack:

Basic Economy is working well in the markets where we offer it today. Customers benefit from our lowest fares that are competitive with no-frills carriers while experiencing American’s unparalleled network, better product and great customer service. Removing the carry-on bag restriction will make our short-haul Basic Economy fares more competitive with airlines that include a carry-on bag in their lowest fares. 

Allow me to translate:

“We tried to screw over our customers in an attempt to earn even more money but it didn’t work. It turns out our customers aren’t quite as dumb as we though they were and they started defecting to other airlines where they got more for their hard-earned dollars. We’re now changing our policy in the hope that we can stem the loss of passengers and if you could all kindly forget what a mess we’ve made of this we’d be very grateful”.

Fantastic!

American can claim whatever it wants to claim but the fact is that there’s absolutely no way it would be reversing the decision to cut the hand baggage allowance on Basic Economy fares if it didn’t believe that the policy was hurting it…and hurting it badly.

airplanes at an airport

Ever since US Airways management took over at American Airlines we’ve seen cut after cut after cut to both the loyalty program and the product offered onboard so it’s great to see some of the negative changes finally coming home to roost.

Personally I’m not likely to forget how American has treated flyers over the past few years so when there’s an option to fly with a more progressive thinking airline (at least in terms of passenger service) like Delta, JetBlue and Southwest that’s the option I’m likely to take.

With a bit of luck enough other flyers will feel the same way and American will get the comeuppance it deserves.

3 COMMENTS

  1. The general mood of snarky and critical in this is … superb! AND appropriate !!
    SUCH a transparent money grab. Our ugly little capitalist experiment run amuck.

  2. JetBlue more progressive? Really? After they’ve cancelled 1 free check-in bag and set the price tag higher?
    Common! All airlines’re trying to screw me, I’m screwing them driving my car up to 500 miles. And flying less to destination situated beyond that threshold. Overall, I’m saving about 25-30% of my money previously spent for flying. Airlines are getting less money from me.
    Try to do the same. Drive for shorter distances, fly less. Together we can kick them really hard! One month of low load can destroy ANY airline, no matter how big it is!
    BTW, the same sh*t regarding the TSA

    • Yes, JB has dropped the hammer with checked bag allowances and fees (hardly ideal) but in the grand scheme its still a much friendlier airline to passengers than AA or UA. Delta also has its issues (not least the abysmal SkyPesos) but, again, compared to AA/UA their overall treatment of customers is significantly better.

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