jjbiv
Topic Author
Posts: 1210
Joined: Mon Jan 08, 2001 10:58 am

Volaris changes baggage policy: no more free baggage to/from US/Mexico

Fri Feb 17, 2017 6:39 pm

Starting March 1, tickets purchased on Volaris for travel between US and Mexico will no longer be allowed one free checked bag: http://cms.volaris.com/en/useful-information/baggage/checked-baggage/checked-baggage/

The current checked bag free (1 extra bag) is $50.99USD.

This is going to be a disaster for Volaris unless they introduce a lower-priced baggage option on these US-Mexico flights. Interjet will eat them for lunch on competing routes if Volaris believes they can essentially raise the price of a RT US-Mexico ticket by $100. Given their low fares and frequent sales, even with a zero fare ticket, taxes and baggage fees would make Volaris more expensive than Interjet, who also offers more amenities to boot.

it will be interesting to see how this plays out.
 
KrustyTheKlown
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Re: Volaris changes baggage policy: no more free baggage to/from US/Mexico

Fri Feb 17, 2017 6:58 pm

Aeromexico introduced the same policy this month but I think their fee is 25 USD/bag.
 
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PatrickZ80
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Re: Volaris changes baggage policy: no more free baggage to/from US/Mexico

Fri Feb 17, 2017 7:12 pm

Charging for checked luggage is becoming more common every day, every airline does this. Volaris is supposed to be a LCC so you'd only suspect them to charge for checked luggage.

Besides, nobody forces you to check luggage. You can travel with hand luggage only free of charge. Most people flying on a LCC don't have any checked luggage, baggage holds on LCC aircraft are almost empty each flight.

Don't forget that airlines have to pay the airports for handling checked luggage and the more luggage the more they got to pay. If there's less checked luggage the airlines got to pay less and thus the ticket price can be lowered. That is why I personally prefer to travel on airlines that do charge for checked luggage, which I don't have of course. Long live traveling with hand luggage only.
 
jjbiv
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Re: Volaris changes baggage policy: no more free baggage to/from US/Mexico

Fri Feb 17, 2017 7:20 pm

I think charging for checked baggage makes a lot of sense. However, it would be nice if Volaris would update their schedule of fees with the price of a first checked bag. Hopefully it will be less than the current fee for 1 extra bag (http://cms.volaris.com/globalassets/pdf ... e_fees.pdf). If not, they will not be competitive with Interjet unless Interjet decides to implement the same charge. This is similar to comparing Southwest vs. everyone else in the US domestic market. Southwest uses free baggage as a point of competitive differentiation. It might still make sense to check a bag with another airline if the fare is low enough. But we don't know this information yet with respect to Volaris. This would also help potential customers decide whether or not to buy a ticket before or after March 1. Even if the fee is $50 per bag RT, it could make more sense to buy now and get the bag included than to wait and pay the fee since I doubt Volaris will be dropping fares on March 1 by the amount of the baggage fee. So this is effectively a change to generate more revenue. Time will tell.
 
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LAXintl
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Re: Volaris changes baggage policy: no more free baggage to/from US/Mexico

Fri Feb 17, 2017 7:33 pm

They will be fine.

Volaris today released their 2016 earnings with whopping 38% EBITDAR margin.

As management has stated by doing this they can further reduce headline airfares. Volaris goal is to shift more revenue to non-ticket ancillary bucket and continue reducing average ticket revenue price.
Their experience shows the lower ticket price, the more they stimulate demand and thus grow ancillary revenue even faster making up for the lower ticket price.

As far as Interjet, frankly, no one knows if they are making money or not. Per their twice abortive IPOs their earnings have been hit or miss. Personally I have doubts about their long term future running full service, lower density airline still while earning LCC fares without benefit of ancillaries.

jjbiv wrote:
I think charging for checked baggage makes a lot of sense. However, it would be nice if Volaris would update their schedule of fees with the price of a first checked bag. Hopefully it will be less than the current fee for 1 extra bag (http://cms.volaris.com/globalassets/pdf ... e_fees.pdf). If not, they will not be competitive with Interjet unless Interjet decides to implement the same charge. This is similar to comparing Southwest vs. everyone else in the US domestic market. Southwest uses free baggage as a point of competitive differentiation. It might still make sense to check a bag with another airline if the fare is low enough. But we don't know this information yet with respect to Volaris. This would also help potential customers decide whether or not to buy a ticket before or after March 1. Even if the fee is $50 per bag RT, it could make more sense to buy now and get the bag included than to wait and pay the fee since I doubt Volaris will be dropping fares on March 1 by the amount of the baggage fee. So this is effectively a change to generate more revenue. Time will tell.


As you have posted the new charge is effective March 1st, so they wont post the info until then as it effects no one that purchases tickets prior. (read your link)
From the desert to the sea, to all of Southern California
 
EddieDude
Posts: 6476
Joined: Fri Nov 14, 2003 10:19 am

Re: Volaris changes baggage policy: no more free baggage to/from US/Mexico

Fri Feb 17, 2017 7:39 pm

KrustyTheKlown wrote:
Aeromexico introduced the same policy this month but I think their fee is 25 USD/bag.

A point-of-sale customer service agent from AM told me yesterday that the fee is 400 MXN plus value added tax per bag, payable at the airport (I suppose you could also pay upon booking online). At the current exchange rate that is a bit under USD 20. Maybe if you pay in USD or if you embark in the U.S., the fee is USD 25.

Btw, if I am a SkyTeam Elite Plus member, will AM waive this fee? Seems to me that if they don't waive it, it would be a very bad way of treating their most valuable passengers.

PatrickZ80 wrote:
Most people flying on a LCC don't have any checked luggage, baggage holds on LCC aircraft are almost empty each flight.

I agree this creates an incentive to not check bags, but the thing is that the U.S.-Mexico market is very particular in this respect. There is always lots of luggage. VFR traffic coming from the U.S. to Mexico (i.e., paisanos) bring clothes, toys and stuff like TVs and Blu-Ray players for their families. Mexican tourists vacationing in the U.S. bring back suitcases full of shoes, clothes, toys and shit in general bought at outlet malls, regular malls, Target, etc. Clearly Volaris and AM know very well that they will make an awful lot of money by imposing this fee.

The people less likely to check bags in the U.S.-Mexico market are businesspeople, and those do not fly Volaris and would not have any reservations to pay a checked bag fee if needed.
Upcoming S4 0221 LIS-PDL A310-300!!!
 
jjbiv
Topic Author
Posts: 1210
Joined: Mon Jan 08, 2001 10:58 am

Re: Volaris changes baggage policy: no more free baggage to/from US/Mexico

Fri Feb 17, 2017 7:52 pm

Agreed. Volaris is very successful financially and provides a great service by offering low fares to stimulate VFR travel demand between the US and Mexico.

If they do reduce fares by ~25 OW and charge a similar baggage fee, that would be fine and have a net benefit by reducing headline prices. However, if they do not significantly reduce fares and instead try to capture some of the additional revenue as margin, the baggage fee will be a substantial portion of the total trip price.

It would be nice to know what the fee will be so folks can buy tickets before March 1 if it makes sense to do so. If thet implement this so it is a wash for the traveler with one checked bag each way, then it doesn't matter. I'm a cheapskate with a lot of upcoming US-Mexico trips planned for this year :-D The US airlines have made me skeptical of these changes!

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