Delta decides to charge more to check a second bag to cut losses

Delta Airlines has just chosen the most inefficient way to cut costs imaginable, to raise the fee on the “second checked bag.”

In an attempt to generate some $100 million in annual revenue, Delta (NYSE: DAL) said it will charge customers a $50 fee to check a second bag on international flights starting July 1. The so-called “unbundling” of services, which includes baggage fees, has been a strong source of revenue for the carrier. So-called “other” net revenue grew 18 percent, or $137 million, largely from baggage fees.

The 747-200 freighters were acquired through the carrier’s merger with Northwest Airlines Corp. Company officials said the planes would likely be sold.

The airline reported a net loss of $794 million and a loss per share of 96 cents, compared with a loss of $6.4 billion and a loss per share of $16.15 in the first quarter of 2008. It is the sixth consecutive quarterly loss for Delta.

Delta’s performance beat analysts’ expectations of about a $1 per share loss.

As another cost cutting measure, Delta plans to ground 50 jets, which includes its entire fleet of 14 Boeing 747-200 freighter aircraft beginning December 31, 2009 due to inefficiency. It will also be grounding 30 Bombardier CRJ aircraft and several “less efficient” Boeing 757 and MD-88.

The grounding of these aircraft is not the problem I have with what is going on at Delta, it is the fact that the company feels the need to charge the consumer more and more for a service they received yesterday at a cheaper price that bothers me.

Hey Delta, take a page from Southwest and perhaps you’ll end up actually turning a profit.