In the past couple of weeks, we’ve seen most US airlines hike checked bag fees, in an effort to increase revenue during a very challenging time (due to high oil prices). American has just matched those checked bag fee increases, but is taking it to the next level, and is making basic economy much worse.
American destroys the value of basic economy for elites
Nowadays virtually every US airline has some form of a basic economy product, with the concept being that it’s intended to better compete with ultra low cost carriers, and fill seats that might otherwise go out empty.
From the perspective of airlines, basic economy isn’t just about offering people lower fares who may otherwise fly other airlines, but instead, it’s about getting existing customers to pay more to avoid basic economy. In other words, basic economy is intended to be punitive, because airlines would ideally have all passengers avoid these fares.
American has just announced a series of changes to basic economy:
- For tickets purchased as of April 9, 2026, checked bag fees will be $5 more for the first and second bag for basic economy tickets compared to standard economy tickets; so a first checked bag will cost $50-55, while a second checked bag will cost $60-65 (depending on whether you pay in advance, or within 24 hours of departure)
- For tickets purchased as of May 18, 2026, basic economy tickets will no longer be eligible for complimentary elite upgrades or in conjunction with systemwide upgrades; cash or mileage upgrades with dynamic pricing will continue to be available on basic economy tickets
- For tickets purchased as of May 18, 2026, basic economy tickets will no longer be eligible for complimentary seat assignments, so even elite members will have to pay in order to assign seats on these fares
This is only the latest negative change to American’s basic economy fares, because in late 2025, the airline made a change so that basic economy fares are no longer eligible for AAdvantage mileage accrual or Loyalty Points.
The intention with this policy change is obvious
We can obviously disagree with the merit to this change, but the intent is obvious — American wants to do everything it can to incentivize elite members to spend more and avoid basic economy. That’s clear based on this change, and it was also clear based on the update a few months back, which meant basic economy no longer counts toward elite status.
When it comes to basic economy, airlines try to find the right balance between generating incremental business and making the fares punitive enough so that passengers want to avoid them. The math on punitive policies differs based on whether someone is an elite or non-elite passenger.
For non-elite members, the biggest change here is just that they’ll pay an extra $5 for a bag, assuming they don’t have it included on account of status or a credit card. But the much bigger change here is for elite members, as basic economy tickets already don’t count toward status, and soon won’t even offer most elite perks either.
Bottom line
American is making major updates to its basic economy fares. Effective immediately, we’re seeing checked bag fees on basic economy fares be $5 higher than on non-basic economy fares. But even bigger news is that for tickets purchased as of May 18, 2026, basic economy tickets will no longer be eligible for upgrades or complimentary seat assignments, so that’s hugely negative for elite members.
What do you make of American’s latest basic economy changes?
