Etihad Is Testing Hand Baggage Only Fares

Historically the Gulf carriers have been pretty full service, especially in economy, where most other airlines around the world have been cutting costs and finding ways to nickel-and-dime. For example, even Emirates has started to charge for advance seat assignments in economy on many fares.

However, Etihad is now testing something that we’ve never seen from a major Gulf carrier before. For a limited time, Etihad is selling hand baggage only fares, which don’t include a free checked bag. Etihad will sell hand baggage only fares for flights from Abu Dhabi to Bahrain and Kuwait for bookings made between October 18 and December 18, 2017, for travel through March 31, 2018.

Passengers who book these fares are entitled to a complimentary carry-on weighing up to 7kg, though can’t check a bag, even at a cost.

Here’s how Etihad’s VP of Commercial, Mohammad Al Bulooki, describes this offering to Emirates 24/7:

Passenger feedback and travel habits show that many of Etihad Airways’ customers, especially those travelling for business, weekend getaways or day trips, don’t require checked baggage, so we are testing a new lower fare on these key routes.

As well as a great proposition for customers, this trial is an effective tool for gauging customer reaction in the real world and testing the product’s viability for wider implementation.

Etihad Airways is enhancing its product offerings to align with customer feedback, offering more choice onboard.

While our core customer proposition remains centred on offering industry-leading service and hospitality, this trial is designed to provide an option for those who are looking for cheaper fares when travelling light.

Apparently this is only the first of many trials that Etihad plans to run over the coming months, in order to “increase customer choice and diversify its revenues in line with digital capabilities that enable the airline to customize its products and services according to consumer demand.”

Let’s keep in mind that when US airlines introduced basic economy fares (which are a bit different), they claimed that these fares would offer passengers a lower cost alternative. However, in reality we quickly learned that airlines weren’t lowering fares in order to introduce basic economy, but rather were increasing fares for those who wanted to avoid basic economy.

The good news in the case of Etihad is that they do genuinely seem to be introducing lower fares with their new hand baggage only scheme. For example, I see one-way fares from Abu Dhabi to Kuwait City for 435AED under the hand baggage only scheme, while the normal fare is 575AED. For dates outside the promo period, I don’t see any flights that are as cheap as 435AED.

Of course if this proves successful, long term it’s possible that Etihad will actually make hand baggage only fares the new norm (at least on regional flights), and charge a premium for fares that include checked bags.

So for now this trial does genuinely seem to be offering lower fares, though I guess we’ll have to see how it develops.

My one piece of feedback with the current trial is that I don’t think they provide enough warning of what consumers should expect with the “Economy Deal” fares. Since these types of fares have never existed before, I think the warning should be more obvious that these fares don’t include checked bags, since this isn’t even something that most consumers in the region would be looking for.

Are you surprised to see a Gulf carrier offering hand baggage only fares?

(Tip of the hat to View from the Wing)

Comments

  1. not like this hasn’t been tried before. Lots of EU carriers have these fares. The only new aspect is that you can’t check bags even if you pay for it.

  2. I wonder what would happen if your carry on was above 7kg. Surcharge? Forced checked luggage (to which you’re not actually entitled to)? Denied boarding?

  3. I wonder the logic behind their decision not to allow paid baggage on these fares. Seems like a missed opportunity to extract a little bit of added value.

  4. They should really stop letting McKinsey advise them. They were good in the 80s, not so much now. Everyone can cut costs.

  5. Maybe they will get like AA where people just take it on board instead and hope for it to be door checked. It never ceases to amaze me how a bag that could fit a person in it, is regarded as carry on.

  6. I wonder what they will do with customers with status on Etihad. Usually they should be allowed to check one additional bag which means they should be allowed to check in one 23kg bag in economy

  7. Just trying to be like the others who give a base price and then add for everything. It wont be long until they start charging for using the toilet. ‘Will that be a number 1 or number 2 Sir will be requiring?’

  8. EY will do well not to listen to hare brained tips from Mckinsey who hare full of consultents past their use by dates

  9. Etihad is a great airline with super innovative ways and smart moves that granted them a big share of the market for a 13 y old airline.
    They also cut costs in other ways unlike Emirates Etihad now charges for all chauffeur drive service for business class worldwide … Their hub lounge is a paid service even for business traveller … Economy seats are now available to book upon a charge if u need a legroom seat it’s definitely for a price and if no one paid for it you are denied sitting there they rather that it remains empty… Service wise and crew memebers are doing it at their best not to forget it’s the only airline that operates huge aircrafts with the very minimum manpower such as 380s 78s and 777s out of all other gulf airlines … The high comfort around the neck pillows were discontinued a month ago and a lots of cost cutting is going on up there
    Tho all these services remains just a plus but they playing it smart I give u now I’ll take it later but you r my customer …everyone is still happy

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