Spirit Airlines is a well-known low-cost carrier in the United States. From its business model, Spirit makes a significant amount of its revenue from ancillary fees. How much exactly? Well, about 50% of total revenue comes from non-ticket sales.
Spirit’s ancillary revenues
The CAPA Centre for Aviation released a report detailing Spirit’s successful ancillary revenue amounts. According to the report, 50% of Spirit’s revenue is made up of ancillary revenues. And, the airline continues to grow. In 2020, Spirit expects a 3% increase compared to 2019 in non-ticket revenue per passenger segment.
However, given Spirit’s low fares, it is not surprising that the airline drives revenue from ancillary charges.
Ancillary products at Spirit Airlines
Spirit Airlines does an excellent job of selling flight tickets. Moreover, the airline also has a robust scheme designed to increase ancillary costs. Let us take a look at Spirit’s booking engine on a flight from Detroit to Orlando. At $37.30, this flight seems like a great one-way bargain!
After clicking “continue”, the booking engine then offers a bundled package:
The bundle itself provides an extensive host of benefits that are also available for individual purchase if only some of the benefits are appealing. If you deny the bundle, the next screen after entering passenger information outlines baggage costs for such a purchase.
Then comes costs for seat selection. Arguably, it would cost Spirit nothing to allow passengers to choose seats for free. However, many travelers likely want to have a say in where they sit on a plane– especially families.
And then, Spirit Airlines offers additional options such as flight modifications, dedicated premium security, and priority boarding.
Ultimately, Spirit expects passengers to spend on more ancillary costs than on the flight ticket itself. Not to mention, a number of people likely would splurge on some additional options.
Then, of course, there are inflight opportunities for Spirit to make some money. This includes meals and beverages for sale in the sky.
Spirit Airlines is one of America’s most well-known low-cost carriers. With low fares, the airline can be a favorite for passengers looking at a budget getaway. However, Spirit does an excellent job selling some upgrades. And, at the end of the day, the cost of the ancillary charges and the ticket may end up being cheaper than some legacy carriers.
Do you fly with Spirit Airlines and purchase ancillary benefits? Do you like Spirit Airlines? Let us know in the comments!