American Airlines will charge for 1st checked bag
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Starting June 15, American will charge passengers a $15 fee for their first checked bag. Last week, the carrier began charging a $25 fee each way for the second checked bag. That means passengers checking two pieces of luggage could end up paying $80 round trip. The increase announced Wednesday does not apply to certain AAdvantage members and some full-fare and international flights.
American’s schedule reductions will result in job cuts and possibly facility closures or consolidations.
Asked whether the layoffs would be in the thousands, AMR chairman and CEO Gerard Arpey said: "I would think so." But he hesitated to give precise numbers to the scope of the cutbacks and how it would affect employees, cities and routes until the airline firms up its plans.
"The objective would be to try to eliminate overheads and costs commensurate with the capacity reduction," Mr. Arpey said. "In terms of what the actual layoffs will be, we don’t have a number for you today."
Mr. Arpey said the capacity reductions will reduce domestic flying by 11 to 12 percent in the fourth quarter compared to the same period of 2007, and overall flying will be down 7 percent or so. He said there may be adjustments on some international markets, but almost all the cutbacks will take place on domestic routes.
The carrier also announced plans to retire up to 75 aircraft as a result of the capacity reductions.
The airline industry as it is constituted today was not built to withstand oil prices at $125 a barrel, and certainly not when record fuel expenses are coupled with a weak U.S. economy," Mr. Arpey said in a statement. "Our company and industry simply cannot afford to sit by hoping for industry and market conditions to improve.”
Most U.S. carriers have announced cutbacks in their schedules for the rest of 2008, mainly on domestic routes, as opposed to international routes, where demand is higher and tickets sold in nondollar currencies bring in more profit.