Business
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Max Knoblauch

American Airlines, the last major free Wi-Fi holdout, is buckling under pressure

“Raw-dogging” that next flight could get even more challenging: American Airlines is testing free in-flight Wi-Fi on a small batch of routes starting next week.

For American, which is currently one of the priciest airlines to fly if you want to scroll, it’s a bid to stay competitive. The carrier has fallen behind rivals like Delta Air Lines, which offers free Wi-Fi for loyalty members and T-Mobile users on most of its flights. United Airlines, meanwhile, is planning to offer free connection through a deal with Starlink this spring.

Many smaller carriers at least offer free messaging — something American said it planned to add back in 2017 but never did.

Free Wi-Fi could be a pricey pivot for American, which currently sells a connection plan for $35 on cross-country routes. According to a report by airline consulting firm IdeaWorksCompany, the carrier pulled in $8.4 billion in ancillary revenue (bags, Wi-Fi, in-flight meals, etc.) in 2023.

American may be willing able to swallow its Wi-Fi losses thanks to big increases in the amount it receives from co-branded credit card partners. Like Delta, American has more than doubled the cash it rakes in from credit card companies. The airline pulled in $6.1 billion from its card partners last year, a hike of 17%. It expects those payments to grow 10% per year. Delta scored an even fatter paycheck, logging $7.4 billion in credit card revenue in 2024.

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Max Knoblauch

American Airlines joins the flock, hiking bag fees amid higher jet fuel prices

American Airlines on Thursday announced that it, too, will be hiking the fees it charges customers to check luggage.

With the move, all four of the major US airlines, which together control about 80% of the US market, have now hiked their baggage fees in recent days amid surging jet fuel prices.

The change will go into effect on tickets bought on or after Thursday, the same day Southwest’s hike begins.

Since late March, JetBlue, Delta Air Lines, United Airlines, Canada’s WestJet, and Southwest have hiked their fees. Experts expect more major carriers to follow, and to potentially tweak the pricing of other ancillary revenue sources like seat assignments and carry-on luggage.

American Airlines updates bag fees and Basic Economy fares

American Airlines updates bag fees and Basic Economy fares

The change will go into effect on tickets bought on or after Thursday, the same day Southwest’s hike begins.

Since late March, JetBlue, Delta Air Lines, United Airlines, Canada’s WestJet, and Southwest have hiked their fees. Experts expect more major carriers to follow, and to potentially tweak the pricing of other ancillary revenue sources like seat assignments and carry-on luggage.

business
Max Knoblauch

Less than a year after implementing them, Southwest is also hiking its bag fees

Southwest Airlines has joined the growing list of airlines opting to hike their bag fees amid sustained higher jet fuel costs.

Starting today, the first checked bag at the carrier — which implemented bag fees less than a year ago — will jump from $35 to $45, and the second from $45 to $55. Southwest quietly disclosed the change Tuesday.

Southwest assigned the decision to “part of an ongoing analysis of the business and against the evolving global backdrop.”

As of Wednesday, jet fuel prices dropped to $4.16 a gallon, per the Argus US Jet Fuel Index, down from $4.81 on Tuesday following President Trump’s ceasefire announcement, which sent travel stocks soaring. Major airlines have shed some of those gains in premarket trading Thursday.

With the move to hike bag fees, Southwest joins JetBlue, United Airlines, Delta Air Lines, and Canada’s WestJet, all of which also boosted fees this month. Experts expect more major carriers to follow, and to potentially tweak the pricing of other ancillary revenue sources like seat assignments and carry-on luggage.

Three US airlines have already hiked baggage fees. More are likely on the way.

Three US airlines have already hiked baggage fees. More are likely on the way.

Southwest assigned the decision to “part of an ongoing analysis of the business and against the evolving global backdrop.”

As of Wednesday, jet fuel prices dropped to $4.16 a gallon, per the Argus US Jet Fuel Index, down from $4.81 on Tuesday following President Trump’s ceasefire announcement, which sent travel stocks soaring. Major airlines have shed some of those gains in premarket trading Thursday.

With the move to hike bag fees, Southwest joins JetBlue, United Airlines, Delta Air Lines, and Canada’s WestJet, all of which also boosted fees this month. Experts expect more major carriers to follow, and to potentially tweak the pricing of other ancillary revenue sources like seat assignments and carry-on luggage.

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