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- Spirit Airlines lowered its revenue estimate, citing a decline in non-ticket revenue.
- That refers to things like bag fees and picking your own seat, which can cost hundreds of dollars.
- In June, United’s CEO criticized the ultra-low-cost carrier business model, saying customers “hate it.”
Passengers are getting fed up with Spirit Airlines‘ additional fees, the carrier’s latest financial filing suggests.
On Tuesday, Spirit filed an 8-K, which warned of a decline in revenue for the second quarter of this year.
It said it expected revenue of $1.28 billion, whereas previous estimates suggested it could be $1.34 billion. Spirit said this was “primarily due to lower-than-expected non-ticket revenue.”
Non-ticket revenue refers to all the add-ons that are a mainstay of the budget airline business model.
That includes things like snacks on board, as well as extra fees for checked bags or picking your own seat.
Spirit estimates that it will earn $64 in non-ticket revenue per passenger segment, which is “several dollars lower than anticipated.”
Ultra-low-cost carriers like Spirit and Frontier have recently come under increased scrutiny. In June, United CEO Scott Kirby told “The Air Show” podcast they are “going out of business” because their business model is flawed and “customers hate it.”
However, Deutsche Bank analysts pointed to Spirit’s decision to remove most of its change and cancellation fees from May, as well as raising the weight limit of checked baggage.
Looking at the airline’s website, there are huge ranges for seat pricing.
Spirit says that requesting a regular seat can cost anywhere from $1 to $200, while its Big Front Seats can cost as much as $900.
The upper limits are likely only in rare circumstances, but the upgrade might still not be worth it. In 2022, Business Insider’s Taylor Rains paid $35 for a Big Front Seat on top of a $30 ticket fare.
Snacks and drinks also have a broad pricing range, between $1 and $15.
The airline’s bag pricing varies, but Spirit’s online calculator only displayed error messages on Wednesday morning. BI reported last month that a carry-on bag on a Spirit flight between New York and Orlando cost $50.
In Tuesday’s filing, Spirit blamed the decreased revenue on “incremental pressure on ancillary pricing due to changes in the competitive marketplace.”
In simple terms: passengers are becoming less willing to spend money on extras.
Spirit did not immediately respond to a request for comment from Business Insider.
