Are you heading off somewhere fun this summer? If so, you might see a new option when you book a flight on American Airlines, Delta, or United: a basic economy fare.
These fares are designed to be cheaper than regular economy fares. Before you hit the “purchase” button, though, there are a few things you need to know.
What Are Basic Economy Fares?
Basic economy fares run about $20-$40 cheaper than normal economy seats. Buyer beware, though: if you purchase one of these seats, you won’t be able to get a refund on it or swap flights outside of a brief cancellation window. American Airlines in particular won’t even offer refunds or flight changes at all.
Furthermore, you lose out on some luxuries while flying in the main cabin — and there weren’t even that many luxuries to begin with. You won’t be able to choose your own seat (you won’t even find out what it is until you get to the gate or check in), and you’ll be the last to board the plane.
On American and United, you’re not even allowed to use the overhead bin. You are allowed one small carry-on that you can stuff under the seat in front of you, however. Make sure you check the allowable carry-on size with the airlines before you go, though, if you’re trying to maximize your space. Otherwise you’ll be socked with a $25 fee for “gate service" on top of the $25 bag fee.
There are also a few smaller disadvantages. You will still earn airline miles, but they won’t count toward elite status on United, and you’ll only earn half as many points as normal toward elite status on American. Finally, you’re not eligible for any complimentary upgrades, and you won’t be able to purchase them either.
Where Are Basic Economy Fares Being Offered?
Basic economy fares aren’t currently being offered on every flight. Delta doesn’t currently advertise which routes have basic economy fares offered, so you might get a surprise when you research your flights.
United is experimenting with the lower fares for flights to and from its Minneapolis hub, whereas American is offering basic economy fares on some flights to cities including Miami, Tampa, Orlando, Fort Lauderdale, New Orleans, Philadelphia, Charlotte, Dallas-Fort Worth, and Baltimore-Washington.
How to Get Around Basic Economy Rules by Using Credit Cards
Each of these airlines offers a branded credit card that allows you to bypass some of the basic economy restrictions, such as allowing you to bring on a carry on bag and board early. Many also allow a free checked bag.
American Airlines offers several cards from Citibank and Barclaycard. United Airlines offers a series of MileagePlus cards through Chase. Finally, Delta offers a series of SkyMiles credit cards through American Express.
Make sure you consider your current flying habits before you sign up for a credit card, however. Each of these airline cards comes with an annual fee — often $95 or more — so it doesn’t make sense to spend $95 to get a $40 discount off of airfare if you only fly once or twice a year.
These cards will only allow you to really see savings if you book at least 3-4 flights per year on the routes where basic economy fares are offered, and only if you need the free perks like a checked bag.
Will We Be Seeing More Basic Economy Fares in the Future?
Why are airlines starting to experiment with basic economy fares anyway?
It turns out that Delta was the first to roll these out back in 2014 in response to the rise of budget airlines in the U.S., like Spirit, Allegiant, and Frontier. These types of budget airlines have been operating successfully in Europe for years, and this business model is just now making its way to the U.S.
Still, the major airlines may need to lower their prices even more to remain competitive in some cases. On some routes, such as from Baltimore-Washington (BWI) to Dallas-Fort Worth (DFW), I saw a price difference of as much as $53 between the budget airlines and the basic economy fares on the major airlines.
As budget airlines become increasingly popular, the major full-price airlines will need a way to cope. It’s therefore very possible that we’ll see more basic economy fares offered in the future. For budget-minded consumers these basic economy fares can be great deals, as long as you’re prepared for the restrictions.
MagnifyMoney is a price comparison and financial education website, founded by former bankers who use their knowledge of how the system works to help you save money.