Industry Intel
Have you noticed how trying to board a flight lately feels like a wrestling match over overhead bin space? In this episode of No Tourists Allowed, Mike and James tackle the absurd reality of rising airline bag fees and the boarding chaos they create. By tuning in, you'll discover insider strategies to beat these sneaky costs, upgrade your boarding experience, and save serious money on your next vacation.
The guys break down the most impactful travel industry news, starting with the controversial rumor of a United and American Airlines merger and the much-anticipated shift toward free Starlink in-flight Wi-Fi. They also spark a debate over the new overtourism taxes hitting popular destinations like Venice, questioning if these tourist fees actually curb crowds or just squeeze travelers' wallets. Plus, Mike and James reveal why underrated destinations in Eastern Europe are the ultimate travel hack right now, but you'll have to listen to find out exactly which historic countries are seeing a massive 36% drop in airfare.
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Episode Resources:
The Chaos of Carry-On Luggage
James Ferrara:
I don't get the psychology. They clearly don't want you to check bags. It costs a lot of money. They make it a hassle. They don't want you to check bags. But then it's chaos on the plane, where there isn't enough room for everyone's bags, and stuff doesn't fit, and people cheat.
They don't put stuff under the seat in front of them, and they're putting their jackets up in the bins. So it's all just a big mess. What happened to the good old days, where everyone checked a bag and you brought something little on the plane with you?
Now I have little old ladies with bags that they could not possibly lift, never mind getting them up into the bin. And the flight attendants are not baggage handlers. They make that pretty clear. So no one wants to help. It was just chaos boarding the plane.
Welcome to No Tourists Allowed
Mike Putman:
Hello, everyone. I'm Mike Putman.
James Ferrara:
And I'm James Ferrara. Welcome to No Tourists Allowed.
Mike Putman:
Good day, sir. Good day. Lots going on in the travel business, that's for sure.
James Ferrara:
Yeah, let's help people navigate so many headlines, so much news. What does all this mean?
Potential Merger: United and American Airlines
Mike Putman:
I wish I had all the answers. But one thing certainly to talk about, which is top of mind right now, is that United CEO Scott Kirby is, I would call it soft-pitching, a merger with American Airlines.
He has come out and said he's been meeting with senior federal officials, floating this idea all the way up to the president a couple months back about United and American merging together. American stock evidently jumped up, which I should know because I own some American stock, unfortunately.
But that evidently rose 5% yesterday. And it looks like the Transportation Secretary, Sean Duffy, said anything's possible under this administration.
James Ferrara:
Well, I think that's really it. If this had been floated under other administrations, I would be jumping up and down saying, there's no way. This is just anti-competitive.
These two airlines together have over a third of the U.S. market. I think United is the largest airline in the world now.
Mike Putman:
I think it's American in terms of available seats. But they both service O'Hare, as an example, and they're both dominant areas. I don't know exactly what the breakdown is, but it's probably around 40% each, maybe even more than that.
If this merger did go through, then they would have 80% market share out of one of America's largest cities.
James Ferrara:
Look, my personal opinion is, I don't think this is good for consumers. I think most administrations would never allow it. But Sean Duffy said that Trump loves to see big deals.
And I think that's very revealing about this administration. It's obviously very pro-business. That's a soft way to put it. So who knows? But it seems like a long shot.
Mike Putman:
Yeah, and I can only think Sean Duffy's other big important thing he was going after was asking Americans not to fly in pajamas. I think those are his two big inputs so far in his administration.
James Ferrara:
All right. Well, here's a rare example of where I actually agree with Donald Trump on the pajama thing and staying off the damn phone.
Mike Putman:
Not that I disagree, but it seems like our federal officials might have more important things to address, especially in the airline industry, than wearing pajamas.
Rising Bag Fees and Boarding Inefficiency
James Ferrara:
Look, also in the airline business, there's been some interesting news about checked bag fees. JetBlue raised its bag fees last month, I think, and it kind of set off a chain reaction.
Now United, Delta, and even Southwest, which was the last holdout, are mostly adding about $10 a bag to fees. But that's significant. A bag fee might be $35 or $50. So another $10 on top of that—this whole bag thing really drives me nuts.
Especially me. I know what you're going to say because I travel with so many bags. I don't get the psychology. They clearly don't want you to check bags. It costs a lot of money and they make it a hassle.
But then it's chaos on the plane where there isn't enough room for everyone's bags and stuff doesn't fit. And people cheat and they don't put stuff under the seat in front of them. It's all just a big mess.
What happened to the good old days where everyone checked a bag and you brought something little on the plane with you? Now I have little old ladies with bags that they could not possibly lift, never mind getting them up into the bin.
And the flight attendants are not baggage handlers. They make that pretty clear. So no one wants to help. It was just chaos boarding the plane. So what is this strategy?
Mike Putman:
Yeah. And take it a step further. Up until the last couple of years, I know that Southwest was profitable every quarter. They were the only U.S. airline that could state that because the U.S. airline business is not a great business to be in.
Just take a look historically over the stock prices and you'll understand. I think collectively the U.S. air industry has lost more money than they made. However, their one darling was Southwest.
Everybody looked to Southwest years ago as this optimally run airline. Many of the analysts said the reason they can be profitable is they only have one type of equipment, which was a 737.
They don't have to have warehouses full of different parts for different types of planes. They just have one air pilot training and not multiple. But their other claim to fame was that they could turn a jet in 30 minutes.
Other airlines had 50 minutes or 45 minutes on average built into their turnarounds. When you think about the cost of capital of leaving a $50 million jet doing nothing for an extra 30 minutes and you do that multiple times a day, it's a lot of money.
This is where Southwest, when they were allowing bags at no charge, pointed to their turnaround time being so quick.
James Ferrara:
And no seat assignments at that time, too.
Mike Putman:
That's right.
James Ferrara:
They've also changed now.
Mike Putman:
They've changed that. But now, when you get on a plane, oftentimes it takes 15 minutes to board. It's not people walking down the aisle; it's people stopping because their suitcase is too big or they have a 70-pound suitcase they can't lift.
Then getting off the plane, it's the same thing. It's row by row, and that's why I don't like sitting in the back of the plane any longer. I would love to see a study that broke down the financial gain versus the inefficiency that becomes from people carrying on their bags.
Strategies to Avoid Baggage Costs
James Ferrara:
Actually, taking that thought a step further, I have an alternate proposal. I think they ought to reduce the bag fees and encourage more people to pay a more modest fee for checking bags.
Right now, they've scared everyone to the point where no one wants to check a bag. I think they'd make more revenue with a slightly lower bag fee, not a higher bag fee. And I also thank you, Rick.
Since we have to deal with it, this is the reality. No Tourists Allowed can help you with a little strategy here. That's what we promise. Whenever you're flying an airline, join the loyalty program. It doesn't cost you anything.
There are often benefits right from the start. For example, if you're a Delta SkyMiles member, you're going to get pushed up in boarding. They put all their loyalty members in the high groups.
Mike Putman:
I would be careful on that one.
James Ferrara:
The funny thing about group two is everyone is in group two. But United does it too. You join United MileagePlus and you're going to be in group two for boarding. Some programs will give you a free bag if you reach a certain status.
I'm a Premier 1K, which means I can bring three bags up to 70 pounds each on every flight for free. But it isn't easy to get to that status. Another way is credit cards. You can get an airline-branded credit card.
A lot of times those programs include a free bag or access to the lounge. You're paying an annual fee, but if you fly a couple of times and you're getting a free bag each time, it's got to be worth it.
Mike Putman:
Absolutely. They have these co-branded cards for American, Delta, and United. I have an American card that has a $95 a year fee. You get a free bag and a $99 companion certificate.
I've got one on United for $500 or $600 a year that gets you a CLEAR membership, which is cutting in line for rich people, and a $200 flight credit. So there's definitely ways around it.
James Ferrara:
Look, we've debated this many times over the years. Mike almost never checks a bag. I almost always check a bag and never carry on. It's a lifestyle choice for me.
I don't want to be encumbered in the airport or fight for bin space. I go free and easy onto the plane. But Mike gets off the plane free and easy because he doesn't have to go to the bag claim and wait for his bag. It's an outlook, a worldview.
Mike Putman:
I'm also on the beach an hour before you are because you're waiting on your bag. I will tell you one other quick story. My wife and I were coming back from Tel Aviv to London and we had bought tickets on easyJet.
My wife always checks in the biggest bag you've ever seen. She carries everything, even a quart of hydrogen peroxide. So we get to the gate for our $79 easyJet tickets and it's $120 to check her monstrous bag.
James Ferrara:
Yep.
Mike Putman:
That was my pain point. But summing this up, these airline executives are addicted to beating last quarter's revenue. This ancillary revenue from Wi-Fi fees and baggage fees has a bigger part in their overall revenue percentage.
I think they'll take any type of risk to increase that, even if it's not good for the company long term. They're addicted to short-term revenues so they can hit numbers and their personal stock options go up.
The Evolution of In-Flight Wi-Fi
James Ferrara:
And I'll tell you, Wi-Fi fees have been dropping over the last years. People objected, and the airlines started to drop them. Now a United Wi-Fi fee is like $8, or you can pay with miles. I remember days when it was $30.
Now we're running into Starlink on some flights. On regional jets with United, that Starlink Wi-Fi is free and the quality is very good. If that rolls out across the industry, airlines have to find a way to make up for lost revenue.
Ancillary fees is really unbundling. The airfare approach is really what saved the airlines 10 or 15 years ago when they were all in trouble. This has really beefed up their financial statements. So you think that Wi-Fi is going to go away on them?
Mike Putman:
It looks like it. There was Gogo and Panasonic that kind of had the grips on that business for quite a while. Starlink came in and truly disrupted the whole system.
I ran a Speedtest on a United regional jet and it was 120 download speeds. You can watch a movie with 120 megabits. Delta said they're going to start offering it for free this spring on all of their domestic flights.
That is a positive sign in the airline space, despite the negative connotation of these additional fees. I do want to talk a little bit about Venice, though, James.
Addressing Overtourism in Venice
Venice is one of those over-served markets. The destination can only support so many people. This is where overtourism has really come into play. The way Venice is handling this is charging visitors.
They stopped allowing many of the cruise ships into Venice.
James Ferrara:
They go to a nearby port now. They don't pull into Venice anymore.
Mike Putman:
And now the government has instituted a day visitor fee on peak days from April through July. There are going to be checkpoints. You have to pay in advance.
If you don't do it in advance and you get inside the gates of the city, there is a very stiff penalty of 50 to 300 euros. If you're going to Venice, you're going to pay a fee to get in now.
James Ferrara:
I'm really conflicted about this. Downtown London has congestion pricing for automobiles. New York tried it, but they pulled back. Mexico has instituted a passenger fee for cruise lines.
We were recently in the Dominican Republic and there is an entrance fee you have to pay. The EU and the UK started these online visas which are essentially just a form you fill out and some money you pay.
It's the same kind of money grab. Even in Hawaii, they've proposed instituting a tourism fee for cruise lines. I'm conflicted because over-tourism is a very real thing in places like Venice.
If asking people to pay helps decrease the numbers of visitors, I get it. But we are travel professionals. We believe in traveling across borders without friction and being able to visit cultural wonders of the world without having to pay.
Mike Putman:
For me personally, taxing people to penalize them to change their behavior for tourism is not a great approach. Venice is five euros a day. We're going to spend that on a good cup of coffee.
But what about a family member who lives in mainland Italy who has a dying aunt in Venice? You're going to ask that person to pay five euros in advance to go see her? I just don't like it.
Many destinations have a hotel tax that they apply to every hotel stay. Some are figured in a percentage and some are flat fees.
James Ferrara:
There are airport taxes, hotel taxes, and sales taxes. It's not like you're coming as a visitor and not contributing to the infrastructure. You're contributing in a hundred ways.
A hotel bill is ridiculous now with all the itemized things on it. It's like death by a thousand cuts. I know it's only five euros, but how many times do we have to pay for the same thing?
Win an All-Inclusive Trip to Mexico
Mike Putman:
Let's talk about something happy in the travel business. There's nothing more happy than traveling somewhere for free. Do you agree, James?
James Ferrara:
Yeah. Free is good.
Mike Putman:
If you are a supporter of No Tourists Allowed and you go to notouristsallowed.com, you can enter our sweepstakes where you will have the opportunity to take an all-inclusive trip on us down to sunny Mexico.
Most of the taxes are going to be on us because we're funding this trip for a lucky winner and their guest. Make sure you go to No Tourists Allowed and sign up for our newsletter. You get an automatic entry that way.
Tell your friends and family about it because we'd love to have you take advantage of this free trip. I think we're wrapping up on time here. Thanks so much to our listeners.
Exploring Underrated Destinations in Eastern Europe
James Ferrara:
I did want to throw out something very interesting. We're trying to give our listeners inside intel on places to travel that are more authentic. Some of the advice we've given over the years was confirmed by CNN talking about North Macedonia as Europe's most underrated destination.
We've talked about that area north of Greece—Albania, Serbia, Montenegro—as a kind of undiscovered area. It looks like Europe did 100 years ago. There are big forests and great culture.
Kayak said that of the 10 fastest-growing destinations, seven of them are in Eastern Europe: Prague, Sofia, Krakow, Budapest, and Sarajevo. If you want to go beyond the crowds of Venice, start looking at Eastern Europe.
Mike Putman:
Absolutely. This is where you'll find some of the best values in the entire world. You can travel for significantly less in Eastern Europe than you can elsewhere.
James Ferrara:
And airfares are down to Eastern Europe about 36% versus last year. That doesn't look like the rest of the market. My flights have been costing twice as much as usual, so that's another great reason to look at it.
Mike Putman:
Absolutely. Well, thanks for listening in folks or watching on YouTube. We're available wherever you get your podcasts and on our YouTube channel, No Tourists Allowed.
James Ferrara:
Great to have you guys this week. I hope you win the free vacation for two and we look forward to seeing you next time.
Mike Putman:
Thanks so much.
