Civil aviation min says passengers won't be charged for carrying luggage

At present, Indian carriers allow up to 15 kilos of check-in baggage free

The civil aviation ministry is against burdening passengers with additional luggage fees, even as the Directorate General of Civil Aviation (DGCA) is examining a proposal by low-cost airlines to offer discounts for no luggage.

“Our observation is in case airlines want to give some relaxation or incentive for zero baggage, it is fine. But at present, we will not permit them to overload the passenger for carrying luggage by charging them separately,” Minister of State for Civil Aviation, Mahesh Sharma, told Business Standard.

Indian carriers allow passengers to carry up to 15 kg of check-in luggage for free.

The DGCA is examining a proposal by three airlines — AirAsia, IndiGo and SpiceJet — to introduce zero luggage fare. Under this, the airlines would incentivise passengers carrying no check-in bags and offer them lower fares but scrap the entitlement to 15 kg of free luggage.
 

“The proposal is under examination. We have asked for the complete details of their proposal. The airlines have asked whether zero luggage by passengers can be encouraged and a discount be given on that and we have asked for further details. We will look into the proposal,” said DGCA chief M Sathiyavathy.

In 2013, the DGCA had allowed airlines to un-bundle services and charge passengers separately for services such as on-board meals, use of lounge, preferred seats and check-in luggage. Though the norm pertaining to the number of preferred seats to be sold by an airline was revised, that relating to check-in luggage was unchanged.

“Airlines are allowed to un-bundle services but since stopping free baggage allowances will have wider ramifications and impact passengers, a DGCA approval would be required for that,” DGCA sources said.

The airlines’ proposals to scrap free luggage allowance were submitted to the DGCA last year but the regulator did not approve those immediately. Last year, AirAsia India was forced to withdraw charges for luggage of up to 15 kg because it hadn’t intimated the regulator about the charges.

ANCILLARY REVENUE

• Ancillary revenue is income earned by airlines through sale of services - fees for bags, extra leg room, sale of frequent flyer miles and advertising, among others
• Globally, airlines are estimated to have earned $49.9 billion in ancillary revenue in 2014
• AirAsia Malaysia earns about 18 per cent of its revenue from ancillary sources
• For some European and US airlines, the share is 20-30 per cent
• In the US, airlines earned $ 1.6 billion from baggage and date change fees in the first quarter of 2015
• Air India earns 1-2 per cent of its passenger revenue from ancillary sources, while Jet Airways gets 5 per cent of revenue from it

In April, the DGCA asked all airlines to submit additional details on the incentives that would be given, among others aspects. “Before any decision is taken, the proposal needs to be properly analysed,” sources said, adding no response had been received yet.

In April, SpiceJet introduced the zero-luggage concept, offering 150,000 seats starting at Rs 999 each, in a limited sale for passengers travelling with hand luggage alone. The airline, however, continued with the concept of entitlement to 15 kg of free luggage.

An IndiGo spokesperson declined to comment on the issue. A source in that airline said it had no plans to scrap free luggage allowance.

AirAsia India wasn’t available for comment.

Executives from SpiceJet said the DGCA’s March circular allowed airlines to un-bundle services and no further regulatory approvals would be required for charging for check-in luggage.

A source in SpiceJet said, “We are not considering charging for 15 kg of baggage as of now. But we understand that unbundling of check-in baggage has been already done, according to the DGCA’s March circular.”