Ryanair shakes up baggage fees as passengers lose extra cabin bag
Budget airline Ryanair fell 1% at the open on Wednesday after it announced a series of changes to its baggage regulations, including the withdrawal of a second cabin bag for non-priority passengers.
Ryanair Holdings (CDI)
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Ryanair also announced it was reducing the price for standard check-in bags to £25 from £35, and increasing the allowance for said bags to 20kg from 15kg.
The move comes as the airline faces increasing delays associated with overcrowded cabins, as it aims to encourage more passengers to check on their luggage beforehand.
The Irish firm also added that those who bring two cabin bags to the boarding gate will have to check their bag in the hold, but will not be charged.
The new baggage restrictions will come into force on 1 November, Ryanair said, and are estimated to cost the company as much as €50m.
FLIGHT DELAYS
"We believe offering bigger bags at reduced fees will encourage more customers to consider checking-in a bag, which will reduce the high volume of customers we have with 2 carry-on bags at the boarding gates, which is causing flight delays due to large numbers of gate bag and cabin bag offloads," Ryanair’s Kenny Jacobs said.
"We hope that by restricting non-priority customers to one small carry-on bag – their wheelie bag must be placed in the hold, free of charge at the boarding gate – this will speed up the boarding of flights and eliminate flight delays being caused by not having sufficient overhead cabin space," he added.
Ryanair was down 0.94% in early trading on Wednesday following the announcement, and ETX Capital analyst Neil Wilson said the increased costs for the airline was the major factor.
"The only important number is €50m – the amount Ryanair says it will cost the airline in lost check-in charges," Wilson commented.
"It hopes to claw this back by encouraging more people to check in bag but investors aren’t buying it. Worries about a turbulent second half, terror attacks in Europe and falling average fares have already got the market worried, although traffic growth in August was strong."