WestJet Airlines Ltd. has joined rival Porter Airlines Inc. in charging travellers a fee for their first checked bag.
And Air Canada is likely to soon announce a similar fee, says one analyst.
The Calgary-based carrier said on Monday it will charge a $25 fee one-way for a first checked bag on Econo fares for travel within Canada and between Canada and the United States.
The fee will apply to flights starting Oct. 29 that were booked as of Monday.
Airlines have been mulling or instituting checked-bag fees as they face rising fuel costs and the drop in value of the Canadian dollar.
Air Canada has so far not set up a first-checked-bag fee on domestic flights but charges $25 for first checked bags on economy flights to the U.S.
The practice is commonplace on U.S. airlines.
“We expect Air Canada will quickly follow suit – possibly with ann announcement as early as today,” RBC Dominion Securities analyst Walter Spracklin said in a research note Monday.
“With today’s announcement from WestJet, it now opens the door for Air Canada to follow suit.”
The change at WestJet will affect about one in five passengers, the company said on Monday.
Industry analyst Helane Becker, who follows airlines for Cowen and Co. in New York, said a full year of baggage fees should add 40 cents a share to WestJet’s earnings per share in 2015.
Toronto-based Porter introduced its domestic $25 first-checked-bag fee in May. Last August, it began charging passengers $25 for first bags checked on U.S. flights.
Airlines have over the years been gradually adding fees for services such as checked baggage, on-board meals and seat selection.
WestJet said on Monday that passengers choosing the company’s Flex fare will receive one free checked bag while those opting for the Plus fare get two complimentary checked bags in addition to waived fees, seat selection, more legroom and other amenities.
Under a new loyalty program with three levels – Teal, Silver and Gold – also announced Monday, WestJet will provide free first-checked baggage for passengers qualifying for the Silver tier; Gold allows for two free checked bags.
WestJet is also launching a “price-drop guarantee” on WestJet flights and vacation packages, for passengers who see that the cost of their flight or vacation package has dropped since their original purchase; they receive the difference in WestJet dollars.
“Today’s announcements are further evidence of our commitment to our guests as Canada’s low-fare leader,” Bob Cummings, WestJet executive vice-president of sales, marketing and guest experience, said.
“As we continue to evolve our fare products, we are creating more value by offering our guests the opportunity to purchase only those services they want. This user-pay type of system allows us to keep fares as low as possible, introduce lower sale fares and avoid fare increases, which benefits you and liberates even more Canadians from the high cost of air travel.”
Air Canada spokesman Peter Fitzpatrick said the airline will evaluate the WestJet move.
With files from Greg KeenanReport Typo/Error