American to start charging for first bag

NEW YORK - For some time, cash-strapped airlines have been doing away with once-complimentary passenger perks such as earphones, meals, and extra legroom in exit rows.

Now the largest U.S. carrier, American Airlines, is testing the limits of passengers' willingness to pay for extras, announcing yesterday plans to start charging $15 for what many fliers consider a necessity: a single checked bag.

What's next? "Pay toilets in the coach cabin, maybe," joked longtime airline consultant Mike Boyd.

American's move is part of a broader effort by the industry to find ways to boost revenue in the face of soaring fuel prices and a slumping economy. The nation's airlines anticipated a multibillion-dollar loss this year, even before oil's latest spike of $4.19 to close at $133.17 a barrel yesterday.

Still, the latest effort could be a tough sell with passengers.

"It's ridiculous," said Louise Schum, a 23-year-old student from Colorado, during a 10-hour layover at Miami International Airport. "Charging for luggage is the cutoff line."

United Airlines said it was "seriously studying" a similar charge.

American, of Fort Worth, Texas, announced the change at the same time it said it would slash its domestic capacity and retire at least 75 older, gas-guzzling planes. The capacity reduction - about 12 percent - will be implemented after the peak summer travel season.

The carrier also said it would slash jobs. Chairman and chief executive officer Gerald J. Arpey, while not offering a specific head count, indicated the number would be in the thousands. The company has 90,000 employees.

Travelers are likely to see other carriers follow suit, assuming the change becomes permanent.

"They're always going to be looking for additional ways" to make money, said Ray Neidl, who monitors the airline industry for Calyon Securities Inc. "Customers want low ticket prices, and they seem willing to pay for extra services."

Under American's plan, many domestic passengers who buy tickets after June 14 will have to pay $15 each way for the first piece of checked luggage. The fee does not apply to passengers who pay full-price for tickets, elite members of its frequent-flier program, or people traveling overseas.

Carry-on bags, popular with business travelers on overnight trips, will remain free.

"This is not going to apply . . . to the people who can most afford it, the business traveler," said Bob Harrell of New York travel and aviation consulting firm Harrell Associates. "It's going to be the poor schmo, the vacation traveler, who ends up paying these fees."

American also said it was raising fees for a number of other services, including those to transport pets and check oversize luggage.

The airline agreed last month to join other major carriers in charging $25 for a second checked bag.