Quote:
Originally Posted by Ryan Coke
FWIW, I don't like it. But to blame it on Canadian oligopoly behaviour? The American carriers have been doing this for years, and AC has been charging on transborder routes since everyone but WestJet does it.
I have seen too often people book on US carriers because the base fare is a few bucks cheaper, not even thinking about bag fees. So it is becoming the new reality, and either you charge or you lose out on the revenue.
To be clear, I don't like it at all. But I do understand it. And it is the Americans largely to blame, not the Canadian oligopoly.
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But what you're describing is exactly what an oligopoly does. One company goes ahead with the fee, the other knows that the consumer has no other choice, so introduces their own fee. Air Canada will probably introduce their fee within weeks, if not days, now that WestJet has taken the brunt of the backlash.
Even in the US, the airline market only has a handful of players. There is simply no reason to compete on differentiation. Nobody has the gonads to say "we're not going to gouge you on this" and earn business and loyalty as a result. WestJet used to be that airline in Canada, but they've got no reason to play that role anymore.
That being said, my shares have gone up enough today to cover a few checked bags. Don't get me wrong, it is clearly good business. But they're operating in an environment where the competitors are few and the alternatives are unattractive (driving, etc.).