American, Frontier said to ponder Air Canada model

Air Canada has been doing it for a few years, and now at least two U.S. airlines are thinking about transitioning their fare structure into an ‘a la carte’ pricing model, according to press reports. What that means is offering a few different levels of fares, with the higher ones including more services and amenities, and the lower ones coming with fewer or none – although the passenger has the option of picking from a menu of services and paying for the ones he wants. For example, Air Canada’s lowest fares—called Tango fares – are just for basic transportation; advance seat selection, food vouchers, checking a bag and even collecting frequent flier miles cost extra. The highest fares are fully refundable, and include all the elements that used to be included in ticket prices -- like food service – plus extra perks like priority check-in. The Associated Press reports that American Airlines is considering rolling out his kind of “unbundled” fare product next year. The U.S. airline industry has already taken some steps in that direction with various new checked bag fees, in-flight meal sales and so on, although they are separate and not tied to the fare. But this would take it to a new level – in American’s case, “breaking the cost of a trip into an air fare plus many smaller fees,” AP said. Meanwhile, the Rocky Mountain News reports that Frontier Airlines, currently in Chapter 11 bankruptcy, is planning something similar by the end of this year. “Frontier’s new fare structure will involve offering consumers different price levels for different types of services and amenities, such as seat assignments and frequent flier miles,” the newspaper said, although Frontier didn’t provide any additional details.