![]() ![]() ![]() Revgauge, a startup that provides airlines with a dynamic pricing platform for add-on services, says its partner carriers have seen revenue from ancillaries rise between 8 per cent and 16 per cent on average.Ĭhief executive officer Roopa Mathur says there are benefits for consumers as well. While passengers may be less than thrilled about algorithm-driven airline fees, for the industry the promise of extending dynamic pricing beyond base fares is enticing. ![]() And a more widespread adoption of dynamic pricing would make cost comparisons even more complicated, he said. The more complex fee structures make it more difficult for passengers to compare flight costs beyond base fares, said Tom Bacon, an airline industry consultant based in Denver. Both airlines said they don’t use dynamic pricing for bag fees at the moment. ![]() Gagné said via e-mail.Īir Canada, which revised some of its checked baggage policies last August, has a similar baggage-fee calculator. Passengers can estimate their luggage rates using an online tool on the airline’s website, Ms. The airline, which doesn’t use dynamic pricing for any ancillary products, changed its checked baggage fee policy in April, 2022, spokesperson Julia Kaiser said via e-mail.Īir Transat does not display baggage fee ranges, but company spokesperson Andréan Gagné said prices vary based on flight destinations, in addition to factors such as service class and whether the purchase occurs through online booking or at the airport. On its website, WestJet warns customers that baggage fees for a first and second checked bag increase by $10 within 24 hours of departure. Gradek said.īut it’s not just low-cost carriers showing increasingly complex prices for bags. With the adoption of variable bag fees, Canada’s ultra-low-cost carriers are catching up to their peers in Europe, where budget airlines have been around for much longer, Mr. With Swoop, which doesn’t apply dynamic pricing to bag fees, rates depend on the departure date and flight destination, in addition to differences in applicable taxes, according to spokesperson Julia Brunet. By comparison, for bookings made before that date, the airline lists a single $39.99 charge for a carry-on allowance purchased online. For example, a carry-on bag on its short-haul flights (less than 1,000 kilometres) is now subject to a fee of $59.99 to $66.49 when the booking or check-in are done online. The switch to more complex price ranges for bag fees appears to be recent, at least for some Canadian carriers.īudget carrier Lynx Air advises on its website that new rates apply for bookings made from Feb. “The airlines are trying to outsmart the buyer at every opportunity,” he said. Gradek, who is the co-ordinator of the aviation management program at McGill University. But the use of a range of prices, instead of a single rate, is also aimed at maximizing revenue for airlines, said Mr. But could I dodge the upselling?Īirlines’ dynamic pricing may be causing Canadians to pay higher fares than their neighboursĪ more common pricing strategy among Canadian airlines involves rates that change within set boundaries based on variables such as flight routes and dates – what aviation expert John Gradek calls “variable prices.” That pricing strategy doesn’t require a complex algorithm to gauge in real time a passenger’s willingness to pay or the collective demand for a particular flight segment. I booked a cheap flight on a discount carrier. The strategy, which airlines already use widely to set airfares, allows companies to charge flexible rates based on users’ browsing behaviour and market demand. carrier Spirit Airlines has also disclosed that it uses dynamic pricing for ancillary services. The changes also make it harder for consumers to gauge how much their total flight cost might be before committing to a booking.Īmong the Canadian carriers surveyed by The Globe and Mail, only Porter Airlines said it is currently using dynamic pricing to set rates for bags and seat selection, an approach the company said it adopted in 2019. While flexible rates for bags and other add-on services could result in lower costs for some passengers, they are likely to drive up the overall cost of flying at peak travel times, according to some aviation experts. Log In Create Free AccountĬanadians accustomed to adjusting travel dates and booking times to land the cheapest airfares may want to start doing the same with their baggage fees as well, as a growing number of carriers have adopted flexible pricing for luggage based on factors such as demand, flight routes and time of purchase. ![]()
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