This year, airlines worldwide will be making more $82.2 billion in revenue from fees associated with excess or heavy bags, extra legroom seating, and frequent flyer programs.
And Air Canada is one of the world’s top 10 airlines with the highest revenues on the list, according to a recent report by IdeaWorksCompany and CarTrawler.
These excess fees are called “ancillary revenue” in the industry, and IdeaWorksCompany defines this as, “Revenue beyond the sale of tickets that is generated by direct sales to passengers, or indirectly as a part of the travel experience.”
The recent ancillary revenue report shows that this year’s figures are up 264% from 2010, which was $22.6 billion.
Air Canada ranks tenth in the world in ancillary revenue, raking in $1.18 billion from those extra fees.
Over half (55%) of Air Canada’s ancillary revenue was from what’s called “a la carte” services. These services include onboard sales of food and beverages, checking of baggage and excess baggage, assigned seats, call center support for reservations, onboard entertainment systems, and wireless internet access. The rest of the revenue (45%) was earned through Air Canada’s Aeroplan reward program.
Air Canada’s “a la carte” services revenue exceeds United’s, which comes in at first place with its $6.2 billion ancillary revenue, though only 52% is from such services.
WestJet also makes the list at number 27, earning $300 million in ancillary revenue.
IdeaWorksCompany, which specializes in ancillary revenue improvement, reviewed 138 and 66 were found to reveal financial results related to ancillary revenue.
So next time you’re paying for that $20 seat in advance, now you know what it adds up to.