Hawaiian Airlines is on track to finish this year with the highest amount it has ever earned from checked bags after collecting
$22.1 million in the third quarter and raising its fees by $5 in November.
The state’s largest airline generated $64.8 million in bag fees through the first nine months of 2018, according to data released Monday by the U.S. Department of Transportation. The quarterly number, which doesn’t include the November increase, compares with
$61.1 million during the same period in 2017. At this year’s pace, and with the baggage fee increase last month, Hawaiian easily will exceed its 2017 total of $81.2 million and the record $82.4 million achieved in 2016.
Hawaiian matched several mainland carriers by raising its fees for first and second checked bags to $30 and $40, respectively, on flights between North America and Hawaii. The airline’s neighbor island checked-bag fees remained at $25 and $35, respectively, and $15 and $20 for HawaiianMiles members. Hawaiian offers special programs in which one or more bags can be checked for free.
Airlines are always looking for ways to boost revenue from what they refer to as ancillary fees, and checked bags have been at the forefront to make up for lower fares. Baggage fees also include oversize and overweight bags.
Hawaiian generated
$6.1 million in reservation cancellation and change fees in the third quarter, up
8.3 percent from $5.6 million in the year-earlier period, according to DOT data. Through the first nine months of the year, Hawaiian has collected $18.6 million in such fees, bringing the amount of fees it has received so far this year from checked bags, reservation cancellation and flight change to $83.4 million — easily within reach of topping $100 million for the fourth straight year.
Overall, the 11 reporting U.S. airlines took in $1.29 billion in baggage fees during the third quarter, up 5.7 percent from $1.22 billion in the year-earlier period. Airlines’ reservation and change fees (Southwest does not charge fees to cancel or change flights) fell 6.6 percent to $673 million from $720.2 million.
American Airlines collected the most in baggage fees with $309.2 million and the most in reservation and change fees with $213.2 million. American became the first major carrier to charge for a first checked bag when it assessed passengers $15 in May 2008 to help offset soaring fuel costs.
Hawaiian said Tuesday at its annual Investors Day conference in New York that it also is on pace to surpass $100 million in cargo revenue this year for the first time and that it could top $100 million in Extra Comfort seat revenue in 2019. The airline, which has been phasing in new aircraft, said its final Boeing 767 flight will be in early January. Hawaiian also is due to begin its initial Honolulu-Boston service in April and plans next year to offer service between Sacramento, Calif., and Maui — its eighth North American origin point linked to its Maui hub.
“This year was characterized … by an increase in the competitive capacity level in Hawaii across a number of our routes — in North America, some of our Japan routes (and) in the South Pacific as well,” Hawaiian President and CEO Peter Ingram said. “We were prepared for that and prepared to execute well in that environment. What we didn’t know (is) we would have a year where Mother Nature took an interest in the Hawaiian Islands. We had storms in the spring (on) Kauai, we had the increase in activity in the volcano on the Big Island, and then we had a couple of hurricanes that threatened the island later in the year. On top of that, we faced challenges from delivery delays of our A321s, but in all, despite all those challenges, we’ve accomplished an awful lot of what we set out to do this year.”
