Say goodbye to a free checked bag on JetBlue Airways Corp. if you buy the cheapest ticket. The airline is set to introduce a new fare scale today, Tuesday June 30th, and missing will be its signature, complimentary luggage policy.
The change will leave Southwest Airlines Co. as the only major U.S. carrier that doesn’t charge for an initial checked suitcase in coach. JetBlue has said it plans to unveil three- tiered Fare Options pricing this quarter, which ends June 30 but has declined to say if the company will meet a self-imposed deadline.
JetBlue opted to end the free-bag policy under pressure from investors and analysts to boost revenue after the company failed to reach targets for return on invested capital. The new system will improve operating income by at least $200 million a year by 2017, the airline has said.
“JetBlue sees it as an opportunity to unbundle the fares and offer a lower base fare to certain customers and better monetize the bag fee,” said Joseph DeNardi, a Stifel Financial Corp. analyst.
The changes will debut with a new online booking tool, JetBlue executives said when the plan was introduced in November. Frugal travelers can elect the lowest price, with no free bag. The next costliest fare would include one free piece of luggage, and the top tier will cover two.
“Our customers will have the options to buy up to higher- tier fares that include more value in terms of loyalty points, a free checked bag, two free checked bags, more flexibility on change fees,” Treasurer James Leddy said at an industry conference last month. “With the highest bucket, there would be things like refundability.”
JetBlue, which hasn’t released further details of the fare bundles, has said less than half its customers check a bag.