Monday, February 23, 2009

U.S. Airways abandons charging for drinks!

Seven months and who knows how many lost sales having passed since U.S. Airways CEO Doug Parker announced that his airline would charge $2 for soda or water and $1 for coffee or tea, he's finally admitting what travel experts everywhere already knew: it was a really bad idea.

Over the last year or so, airlines have begun charging or boosted fees for all sorts of things. Passengers now pay to check even one bag on some carriers, and every carrier charges for a second or third piece of luggage. Change fees have gone up. Fees have been added to mileage redemption. United Airlines got out in front by offering a proactive charge to earn more miles through its Award Accelerator program.

Yet despite that apparent willingness to add and expand fees, not a single U.S. airline followed Parker's lead on charging for beverages. Why?

Simple: the idea was stupid.

Seriously, at a time when air travel is less pleasant than ever, why would you possibly want to antagonize passengers by charging them $2 for bottled water?

Parker's example stands in marked contrast to Continental (which still offers complimentary meals to Coach passengers) and highlights a key flaw in the airline model: cutting costs only goes so far. At the end of the day, airlines provide services, and treating passengers like cattle leaves them preferring to fly with a competing airline.

So, after months of defending the supposed success of his policy, Parker has backtracked--apparently surprising some of his own executives, who were still touting the merits of the plan--and U.S. Airways returns to mediocrity from the depths of complete disaster.

I guess we can cheer for that.

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