American Airlines Bites The Bullet

American Airlines is planning to cut its flight capacity by 12 percent, lay off employees and start charging for all checked luggage for most passengers.

Yes, the spirit of Skybus lives on. The Big Six airlines are turning into ultra-no-frills carriers.

Here’s what I believe we can expect from these developments:

  • The other big airlines will follow suit with the $15 fee for a first checked bag, along with the established $25 fee for a second bag. Southwest, which still permits two free checked bags (down from three), may be the exception.
  • A 12 percent capacity cut by the country’s biggest airline will significantly affect flight availability . If current trends hold true, this will be much worse at small airports such as Bradley than at large ones in big cities.
  • Fares will increase. The competitive pressures that force airlines to sell tickets at a loss have already eroded, and the massive capacity cut will free airlines to do charge more to meet their fuel bills.
  • Service will continue to decline. That’s what happens when you cut staff. Fewer people to answer the phones, board the passengers and serve the drinks.



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