JetBlue Baggage Fee & Reduced Legroom
JetBlue announced a few changes today that management says are designed to increase shareholder returns. Among the changes will be a new baggage charge and reduced legroom in their A320 cabins.
New JetBlue Baggage Fee & Tiered Pricing
JetBlue is going to be moving to a three tiered pricing structure in the first half of 2015. The lowest and most economical of the three tiers will now carry a charge for checked luggage, while the middle tier will allow for one bag and the highest tier for two bags. (As far as I could tell, they didn’t announce the actual cost of the new fee.)
The company said they expect the new bag fee to generate $65 million dollars in revenue in 2015 alone according to Fortune. JetBlue and Southwest had been the only two major U.S. Airlines not charging a checked bag fee. Once this change goes into effect, only Southwest will remain.
Reduced Legroom & More Seats
Starting in 2016, JetBlue will retrofit their 122 Airbus A320s by adding an additional 15 seats to each plane. The addition of seats will reduce pitch to about 33″ down from around 35″. This is still better than most other airlines whose pitch in normal coach seats hovers around 31″.
These new seats are also much lighter than the current versions, meaning significant fuel savings over time. Additionally, JetBlue will be installing larger entertainment screens and more power options for all of their customers.
Analysis
These moves, while definitely not positive for consumers are not overwhelmingly negative either. At this point most people are used to baggage fees. Smart consumers calculate their cost by adding up the fare plus fees.
As for the reduced legroom, JetBlue still has a very solid product and while the pitch will be reduced, it is still better than all of the other major U.S. airlines. I can definitely see why the company would want to make this change to increase their yield per flight.
Conclusion
JetBlue also announced a few other items including their wifi strategy and the rollout of their Mint product. For more information, I highly recommend reading their press release.
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