In an attempt to tap an alternate source of revenue and keep base fares low, US Airways and
some other carriers have recently begun to offer an a la carte model of service. Although
the airline has returned complimentary beverages to all flights as of March 2009, US Airways
expects to generate $400 to $500 million in 2009 from a la carte items such as checked
baggage fees, Choice Seats, and blankets and pillows.5
While the new pricing structure does
not seem to have dampened demand, according to US Airways CEO Doug Parker, other
carriers are likely to follow US Airways’ model and lower their base fares accordingly.
Moreover, technology will soon enable customers to compare the true cost of their trip,
taking into account baggage fees and other surcharges.6
Thus, the competitive advantage of
the program may shrink over time.