FORT WORTH, Texas — American Airlines will start charging $15 for the first checked bag, cut domestic flights and lay off possibly thousands of workers as it grapples with record fuel prices.
American plans to cut domestic flight capacity by 11 percent to 12 percent in the fourth quarter, after the peak summer season is over. That’s more than double American’s previous plans to cut flying by 4.6 percent in late 2008.
The airline has 22 daily departures from Denver International Airport, representing only a fraction of its traffic. Through the first three months of the year, American held a 3.38 percent market share at DIA. United, the dominant carrier at DIA, has just over 50 percent of the market share.
An American spokesman said the carrier is not yet disclosing how the flight cuts will affect specific cities.
American said Wednesday that the fee for the first checked bag starts June 15 and that it would raise other fees for services ranging from reservation help to oversized bags, mostly from $5 to $50 per service.
Last month, American announced it would join other carriers in charging $25 for second bags checked for some passengers, but it wasn’t immediately clear how Wednesday’s announcement would affect that.
Its proposed fee for a first checked bag would exempt people who belong to elite levels of its frequent-flier programs, those who bought full-fare tickets and those traveling overseas.
Chairman and chief executive Gerard Arpey said he expects the new or raised fees will raise several hundred million dollars for American.
The changes were being made to adapt to “the current reality of slow economic growth and high oil prices,” Arpey said.
He didn’t put a figure on the layoffs but said he expected the figure to be in the thousands.
American expects to retire 45 to 50 planes, most of them gas-guzzling MD-80s. Its expected annual fuel costs have climbed to nearly $3 billion since the start of the year.
Denver Post staff writer Steve Raabe contributed to this report.
Pack extra cash
Major airlines with service at Denver International Airport are charging baggage fees:
Each bag
•American ($15 for the first; was to start a $25 fee for a second bag this month)
Second bag
•Continental ($25)
•Delta ($25)
•JetBlue ($20)
•Northwest ($25)
•US Airways ($25)
•United ($25)
Sources: The Wall Street Journal, The Salt Lake Tribune
