Report Shows Astronomical Rise In Airline Revenue From Ancillary Charges

Revenues from ancillary charges by the world's airlines leaped 346 percent between 2006 and 2008, according to The 2009 Guide to Ancillary Revenue and a la Carte Pricing, published by Shorewood, Wis.-based consulting firm IdeaWorks on Tuesday. Total revenues from add-on fees for the services, such as checked baggage and priority boarding, rose from €1.72 billion to €7.68 billion during the two-year period.

The guide, which studied the financial statements of 92 carriers, found that the biggest recipient of ancillary revenues in 2008 was American Airlines, earning €1.65 billion. It was followed by two U.S. rivals, United Airlines at €1.26 billion and Delta Air Lines at €1.125 billion. In fourth and fifth positions, respectively, were European low-cost carrier Ryanair at €625 million and Australia's Qantas at €458 million.

In terms of ancillary revenues as a percentage of total revenue, the top airline was the U.S. leisure-based airline Allegiant at 22.7 percent. The remaining four in the top five were all European budget carriers, led by Ryanair at 19.3 percent.

By the time the next guide is published, Ryanair may have knocked Allegiant off the top spot. The Dublin-based airline last Friday announced it would hike checked-bag fees by 50 percent starting Oct. 1. A first checked bag will rise to €15 if checked in online or double that amount at the airport.