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Despite Shutdowns, Americans Paid the Most in Ancillary Fees

Even though travel was depressed in 2020, U.S. and Canadian-based flyers paid an estimated $19.5 billion in luggage, seat selection costs and through credit card programs to airlines. Data from the CarTrawler/IdeaWorksCompany study showed North American flyers were charged the most in ancillary fees, accounting for 33.5 percent of all sales worldwide.

Although the COVID-19 pandemic forced frequent flyers to stay at home and airlines to significantly cut back service, the North American carriers still collected the most in ancillary fees from their customers. Recent data from CarTrawler and the IdeaWorksCompany shows airlines in the United States and Canada charged flyers the most for extras compared to carriers in other regions.

North American Ancillary Fees Accounted for 33.5 Percent Collected Worldwide

From a global perspective, airlines make a total of $52.8 billion from flyers in 2020 on everything from checked luggage and carry-on fees, to seat selection and upgrades, and even credit card fees. Comparing data from the third quarter of 2020 across 20 airlines, ancillary revenue per passenger increased actually at the height of the COVID-19 pandemic. The average revenue per flyer grew to $26.91, up by over $3 compared to the same time in 2019.

The most money was collected from those aboard U.S. and Canadian carriers. The $19.5 billion collected between operators in the two nations accounted for 33.5 percent of all ancillary fees collected worldwide. In Europe and Russia, airlines collected $16.2 billion in extras, while Asia-Pacific carriers collected $14.8 billion in buy-up options.

Among the leading airlines, United Airlines flyers spent the most on ancillary fees in the third quarter of 2020. The airline collected an average of $65.51 per passenger during the surveyed time period, an increase of 59 percent compared to the same time in 2019. Alaska Airlines collected $54.80 per passenger, while Southwest made an average of $47.59 per flyer. European low-cost carrier Wizz Air brought in $42.66 per passenger, giving them the highest haul from non-North American airlines.

Credit Card Programs Add to Ancillary Profitability for Airlines

Checked bags and seat selection wasn’t the only reason why North America collected the most in ancillary fees. Credit card programs also played a major part, contributing millions to the airline’s bottom lines. As the legacy carriers used loyalty programs to raise money in 2020, both United and Delta Air Lines showed how profitable credit cards can be. But even with the aid of JPMorgan Chase and American Express, the potential haul ancillary fees could have brought dropped by an estimated 44.6 percent in 2020.

dano45 February 2, 2021

Surprising! Thanks for this info.