Air Canada cuts baggage surcharge after oil price falls

Toronto: Air Canada Thursday became the first major airline in North America to remove the second checked bag surcharge in the wake of falling fuel prices.

The $25 surcharge was introduced in May as the airline faced an additional burden of $1 billion because of higher fuel costs.

Canada's national carrier has also announced it would incorporate the fuel surcharge into its base fares on North American flights.

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In a statement, Air Canada executive vice president Ben Smith said: "Although the cost of fuel remains highly volatile and far above historic norms, the recent retreat in oil prices is enabling us to reinstate our previous baggage policy.

"We are eliminating the second checked bag charge on North American Tango and Tango Plus fares, reflecting our customers' expressed preferences.

"Further, Air Canada is making its pricing more transparent by removing the add-on fuel surcharges for flights within North America and instead adjusting its base fares to cover the total cost of fuel."

Smith said: "These initiatives are made possible by the recent relief from all-time high oil prices and even though fares will remain dynamic, Air Canada is committed to everyday low prices and will continue to match the lowest fares in the marketplace."

To cut its losses, the airline has already cancelled many flights to US and European cities.

With a fleet of 335 aircraft, Air Canada serves 34 million passengers each year, connecting them to 170 destinations across the world.
Source: IANS