TORONTO — Collusion or competition? Air Canada and WestJet are facing a proposed class action lawsuit alleging the two carriers teamed up to introduce baggage fees within days of each other in 2014.
WestJet brought in its $25 checked bag fee on Sept. 15, 2014. Three days later Air Canada followed suit. The challenge will be proving Air Canada and WestJet were in cahoots, and not just reacting to pricing moves in a competitive environment, both in Canada as well as the U.S. where fees for checked bags had been in place for some time.
According to the CBC, the class action suit must be certified by the Court of Queen’s Bench for Saskatchewan before it can proceed. Filed by lead plaintiff and Regina resident Lorne Hoedel, the suit will cover all Canadian passengers who flew with Air Canada or WestJet after Oct. 29, 2014 and paid the fee for either domestic or U.S. flights.
“It’s a wink, wink, we’ll get together and do the same thing,” says lawyer Tony Merchant, in the CBC’s report. “As soon as they had the announcement from WestJet, then [Air Canada] acted. We think we can establish they were acting in concert.”
Airlines have long argued that scaling air ticket prices back to a base fare and then allowing passengers to customize with add-ons is in the best interest of the customer.
Ancillary fees cover everything from baggage fees to seat assignments to onboard meals. The latest edition of the CarTrawler Ancillary Revenue Yearbook by IdeaWorksCompany shows a total of US$40.5 billion in ancillary revenue, comprising nearly 8.7% of total sales, for 67 airlines covered by the survey.
A similar class action lawsuit charging U.S. airlines with collusion over baggage fees is making its way through the courts process in the U.S.