American Airlines raises baggage fees by $10

TheStreet’s J.D. Durkin brings you the biggest news of the day, including how the market fared and why American Airlines is raising baggage fees.

Transcript

00:00 I'm JD Durkin reporting from the floor of the New York Stock Exchange.

00:03 Stocks were in the red to close out today's session.

00:05 The Dow closed down over 60 points.

00:07 The tech-heavy Nasdaq closed down almost a full percent, while the S&P 500 closed 0.6%

00:13 lower.

00:14 This comes as investors anxiously await Nvidia earnings, which are due out Wednesday after

00:19 closing bell.

00:20 Nvidia, of course, is the third largest company by market share, so this report could sway

00:24 markets pretty significantly.

00:27 Investors are also looking out for minutes from the Federal Reserve's January meeting

00:31 for any hints into the future of interest rate cuts.

00:34 Markets are currently pricing in an 8.5% chance of a rate cut in the month of March.

00:40 In other news, American Airlines is raising its price to check luggage.

00:43 Until now, passengers paid $30 for their first checked bag on domestic flights.

00:49 With the change, passengers who booked a checked bag in advance online will pay $35, while

00:54 checking one at the airport will cost $40.

00:56 A second checked bag will now cost $45, whether it's booked in advance or at check-in.

01:02 American Airlines last raised its baggage fees back in 2018, but the company says the

01:07 cost of transporting bags has increased significantly in just the last few years, with fuel prices

01:13 playing a big role.

01:14 In addition to the price hikes, the company also announced it would be scaling back which

01:18 tickets purchased through third-party sites would be eligible for frequent flyer miles.

01:24 According to the Department of Transportation, in the first nine months of 2023, U.S. Airlines

01:29 brought in $5.5 billion from baggage fees, a 9% year-over-year increase.

01:35 American brought in $1 billion alone.

01:37 However, it's not the only airline to have recently raised its baggage fees.

01:41 Both Alaska Airlines and JetBlue have already raised prices in 2024.

01:47 That will do it for your daily briefing.

01:49 From the floor of the New York Stock Exchange, I'm J.D. Durkin with The Street.

01:52 Thanks for watching.

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