Breaking News! Westjet To Charge Travellers For First Checked Bag

[Seeker]

/http://www.theglobeandmail.com/report-on-business/westjet-to-charge-travellers-for-first-checked-bag/article20598212/

[internet]

Blink...

Over/under when AC matches? 2.5 days

[AMEfirst]

Sounds like WJ missed the Friday afternoon news submission cut off time.

[deicer]

And how long before the viral video of bags being thrown off the bridge because the cabin's overloaded?

[MD2]

Don't believe it, WestJet has billions in cash and no need for this...all lies and rumours spread by evil-doers in the other coffe shop who use the wrong kind of beans and at least should have waited until the next long week-end...!!

[Seeker]

A blast from the past....(highlighting mine)

The WestJet "Care-antee"

Airline sets a new Canadian standard in passenger care

CALGARY, April 21 /CNW/ - WestJet today introduced a comprehensive
"Care-antee", setting a new standard for service and value in the Canadian
airline industry.
"The WestJet Care-antee is a set of promises we vow to uphold in good
times and bad," said Bob Cummings, Executive Vice-President, Guest Experience
and Marketing. "It's a very public commitment to our guests that we will
continue to deliver exceptional service and value, especially now when they
need it most."
"So many things are changing right now and people are uncertain about
what they can expect from the companies they deal with in their lives,"
continued Bob Cummings. "The WestJet Care-antee is about showing our guests in
a very real way that these are the things they can expect from their airline,
in good times and bad."Promises in the WestJet Care-antee include:

- We will not charge you to change or cancel your flight for 24 hours
after you book
- We will not charge you for call centre bookings
- We will not overbook your flight
- We will not charge you for two checked bags
- We will have the lowest, change, cancel and pre-reserved seating fees
in Canada
- We will accommodate you if your flight is delayed. Even if it's
Mother Nature's fault
- We will fly you in the youngest all-jet fleet in North America
- We will provide live seatback TV on our flights
- We will give you ample legroom and overhead bin space
- We will publish our on-time, lost baggage and cancellation rates
- We will always let you know how we're doing as a company
- We will offer free online check-in and seat selection 24 hours before
departure
- We will allow you to transfer your credit files to friends or family
for free
- We will give you free snacks and refreshments on your flight
- We will always include smiles and thank yous. Always"The ability to change or cancel your flight within 24 hours of booking
at no charge is something new," said Bob Cummings. "We want our guests to be
able to book with confidence, secure in the knowledge that if something comes
up or they change their mind within that first 24 hours, they can change or
cancel their flight and they'll get their money back, no questions asked."
For more information about the WestJet Care-antee, please visit
westjet.com

[Guest longtimer]

making record profits and now a cash grab. Hmmm Will def. not be popular.

[YYCMatt]

Stock price is up $1.25 so far so some people like it.

[Guest longtimer]

What ever happened to "the guests count, the investors don't"

[dagger]

Everyone is going to do it. No one punished Porter for being first.

I expect AC will match, but presumably has to tailor the match to what WS is doing and that will take some planning.

Meanwhile, crude oil prices continue to plunge, as does the dollar. The economy is going to be interesting going forward - if projects are cancelled or deferred in the oil sands, will manufacturing pick up fast enough to take up the slack, or is the Canadian economy going to seriously lag the US for the next 12-18 months. I can see oil breaking $90 a barrel, and if so, we might see some major project investments scaled back or halted. Not feeling good about things right now.

[Fido]

- if projects are cancelled or deferred in the oil sands,

That is quite often a good thing. It takes the BIG heat out of construction that cannot be staffed or resourced.

[Super 80]

Hooray for "brand suicide" where an irrational level of public goodwill is set ablaze for a few bucks, cabins beat to **bleep**, frayed nerves of gate, cabin crew and “guests” alike and longer turn times.

[Guest longtimer]

Got to love the spin

it's beneficial for passengers

"SUN NEWS NETWORK

TORONTO - Calgary-based WestJet said Monday that it is going to begin charging economy passengers $25 for their first checked bag.
The fee will apply to flights within Canada and on flights between Canada and the U.S.

Flights to other destinations, including the Caribbean, South America, and Europe still include baggage in the base economy fare.

The new fee takes effect on new bookings starting today, for flights on or after Oct. 29.

The airline says they expect this new fee will impact about 20% of their customers, and argue it's beneficial for passengers.

"As we continue to evolve our fare products, we are creating more value by offering our guests the opportunity to purchase only those services they want," said Bob Cummings, WestJet's Executive Vice-President, Sales, Marketing and Guest Experience. "This user-pay type of system allows us to keep fares as low as possible."

[Thebean]

Fearless predictions:

1. Look for a press release from Montreal around 11am eastern time on Friday.

2. Expect a $20 fee for carry on bags in overhead bins within 12 months of implementation. It's the only way they'll be able to manage the onslaught of carry on bags.

I can't say I'm surprised at this. Porter has been charging for first bag for a while and anyone flying sched transborder on anyone other than WJ has been paying for first bag for quite some time.

One can't help feeling the WJ "brand equity" piggy bank that was so carefully nurtured, at the expense of profit, and therefore bonus's, stock option benefit, stock price and profit sharing in the early days is being raided.

Shareholders are clearly happy with the announcement. One can assume shareholders at other airlines will be demanding this gets matched quickly.

The price guarantee is an interesting concept.

[Fido]

The airline says they expect this new fee will impact about 20% of their customers, and argue it's beneficial for passengers.

Does this confirm the theorem that 80% of statistics are made up.

[CD]

The Globe story had a similar quote:

The change at WestJet will affect about one in five passengers, the company said on Monday.

I'm somewhat surprised that so many people do not travel with luggage if only one in five will have to pay the new fee...

[Guest longtimer]

I guess they are telling us that the number of seats available for sale at the lowest fare price is only 1/5 of the total available. (did a marketing secret slip out? )

[Guest]

The Globe story had a similar quote:

I'm somewhat surprised that so many people do not travel with luggage if only one in five will have to pay the new fee...

It's not that 1 out of 5 travel with baggage. It's that the fee will apply to approximately 1 in 5. There are different exclusions based on the fare paid, if you booked with a WestJet Mastercard, etc...

[Guest longtimer]

Buried, so to speak in the announcement is mention of their "New Rewards Program". Now 3 classes of rewards passengers.

[CanadaEH]

You are excluded from the bag fee if you purchase one of the higher 2 fare tiers, if you purchase using your WJ Elite Mastercard, or if you're in the top two tiers of the rewards program.

AC will match quickly. Can't afford not to with profit margins near the industry bottom.

[internet]

Price match really costs them nothing. Maybe a bit of work. Most people won't take advantage - or can't:

Only valid on new bookings starting September 15, 2014

The difference in fare will be given back in WestJet dollars

There must be a minimum $25 difference per person between original and new lower fare

Claims are eligible up to two hours before departure

The lower fare must have the exact same flight date and time, origin and destination, name of guest(s) and fare type (Econo, Flex or Plus)

Flights must be wholly marketed and operated by WestJet and not be in conjunction with any code-share or interline partner

The offer cannot be combined with any other promotional offers or discounts

WestJet dollars will be added to your WestJet account after you've completed the entire trip

[Croc Dundee]

I'd say they are preparing for the possibility of an ultra low cost carrier starting in Canada. The lowest fare product was always designed to be "bare bones" and used to defend against new competitors that have lower costs and lower fares.

[FA@AC]

Expect a $20 fee for carry on bags in overhead bins within 12 months of implementation. It's the only way they'll be able to manage the onslaught of carry on bags.

That would really surprise me unless the U.S. carriers do it first.

[CanadaEH]

Spirit already does. not sure about anyone else.

[Thebean]

http://www.spirit.com/optionalservices

ULCC's are all about ancilliary revenue.

They currently extract an average of about $55 per passenger per segment, one way or another. You can be fairly certain any potential ULCC in Canada will do the same.

WJ gets about $10 per passenger in ancilliary revenue. When this washes through the system, it might add $5-$6 per passenger to the take.

It's a fraction of what the ULCC's will be looking to achieve.

At the end of the day, total revenue, regardless of how it is collected, has to exceed total costs.

It's not rocket science.