Airline ancillary fees soared 21 percent in 2014
Ancillary revenue of global airlines jumped 21% in 2014 to $38.1 billion, according to estimates by aviation analysts IdeaWorks Company.
The company came up with that figure after analyzing the supplementary income earned by 63 airlines worldwide.
Ancillary revenues came from commission-based services such as hotel bookings, co-branded credit cards, loyalty programmes and fees for added services such as extra legroom, checked baggage and cancelation fees.
"Ancillary revenue is an increasingly important indicator of commercial success, and a major contributor to the bottom line of airlines," said Michael Cunningham, chief commercial officer at CarTrawler, sponsor of the report.
"The secret to unlocking this revenue stream can be found in the data that customers generate with every transaction. It is no longer just the preserve of low cost carriers – it is something from which all airlines are benefiting."
As a percentage of total revenue, low cost carriers unsurprisingly gained the most with Spirit Airlines out in front, banking 38% in ancillary fees.
Allegiant wasn’t far behind in third place with 32.4%.
Ancillary revenue at all US carriers jumped by more than 18% or $2.6 billion in 2014, with the big three carriers – United Airlines, American/US Airways, and Delta also the world’s top three for generating the most in ancillary fees.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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