Brazilian Bill Threatens Airline Industry Stability by Banning Checked Bag Fees

A new Brazilian bill proposes banning airline fees for checked bags, sparking concern within the struggling industry. Set to reverse a 2017 rule, the legislation could deter low-cost carriers and disrupt market stability, as critics argue it might hinder economic growth and consumer choice.

Brazil's aviation industry is on edge due to a new bill aiming to prohibit airlines from charging for checked luggage. Industry leaders fear the proposed legislation, now awaiting Senate approval, could disrupt business models and deter low-cost carriers crucial for competitive pricing.

The proposed measure, emerging from Brazil's Lower House, allows free carry-on luggage and bans fees on checked bags up to 23 kg. If passed, it would reverse a 2017 regulation, potentially impacting airlines that rely on revenue from ancillary fees, including 'basic' fares offering minimal service.

With recent bankruptcies among airlines like Azul and Gol, industry executives and lobbyists warn of increased regulatory instability. LATAM Brasil's CEO noted that such measures might restrict operational expansion, a view echoed by CELs of low-cost carriers cautious about the market volatility.

(With inputs from agencies.)