Some industry insiders are not convinced that the airlines conspired with each other to raise their prices at the same time. (Photo: REUTERS/Andy Clark)
A Regina, Sask. resident has filed a class action lawsuit against WestJet and Air Canada, because he alleges that they “colluded to fix the price” when they introduced a $25 fee for the first checked bag within a short time of each other.
Lorne Hoedel, the main complainant in the proposed lawsuit, claims that the airlines “unjustly enriched” themselves by charging the fee as no extra service was offered in exchange for the new fee.
"It kind of rips me off and that's why I decided to pursue this," Hoedel told CBC News.
He believes that it can’t be a coincidence that the two airlines started charging this fee within a few short days of each other. Air Canada announced the new fee on September 18, 2014 just three days after WestJet.
However, some industry insiders are not convinced that the airlines conspired with each other to raise their prices at the same time and say that it’s simply an industry standard to adapt another airline’s policy quickly.
"You watch what your competitors are doing and, by and large, you emulate it. . . [Even] if it's not a great thing for the customer, sometimes these decisions still get made," Calgary aviation analyst Rick Erickson told CBC News.
When Air Canada made the announcement that it was raising the fee shortly after WestJet’s announcement, Chief Financial Officer Michael Rousseau explained to an investor conference in Toronto that, "We're matching the market. . .It's what the market is bearing at this point in time."
Whether the lawsuit goes ahead or not, will depend on if the court believes the airlines could have been conspiring with each other to raise prices, or whether Air Canada simply thought WestJet’s price hike for the first checked bag was a good idea and followed suit.
However, a similar lawsuit in the United States, targeting Delta and AirTran Airways first checked bag fee that was announced within two days of each other was recently given the green light to go ahead.