US Airways Group Inc. chief executive Doug Parker has stated that the airline industry needs to get much smaller to stay viable, and consolidation is one of the keys to bringing the sector back to profitability.

Published: 11 Jun 2009

US Airways Group Inc. chief executive Doug Parker has stated that the airline industry needs to get much smaller to stay viable, and consolidation is one of the keys to bringing the sector back to profitability.

Speaking at the carrier’s annual meeting in New York, Parker also reiterated the carrier’s plan to rake in $400 million to $500 million this year by charging for things such as checked bags and choice seating. He said extra fees are here to stay, according to a report filed by AP.

Parker said that the fees, or “ancillary revenue”, have allowed the airline to compensate for revenue lost last year to high fuel prices, and this year to the steep drop off in the economy.

Parker said that although some customers were turned off by the bag fees, the added charges have reduced the number of bags flowing through the system by 20 percent — and allowed baggage handling systems to operate more efficiently.

In addition to $15 for a first checked bag and $25 for a second, US Airways currently charges for other a la carte items like choice seats in coach and pillows and blankets.