As the world’s air carriers bleed more red ink as they enter the weak travel season, many airlines will feed the corporate coffers by charging those who are still flying additional fees that go beyond the actual cost of providing safe passage.

The world’s airlines are expected to lose a combined $11 billion in 2009, $2 billion more than previous forecast, as the cost of fuel rises and the number of passengers and the volume of cargo sink, according to the International Air Transport Association (IATA).

And IATA revised its estimates for 2008 from a loss of $10.4 billion to $16.8 billion.

On a positive note, air carrier net losses worldwide are expected to be limited to $3.8 billion next year because of some growth in traffic volumes, stated IATA Director General and CEO Giovanni Bisignani in a speech before the International Aviation Club in Washington, DC recently. This is based on a limited revival of growth in traffic volumes of 3.2 percent for passenger and five percent for cargo; very little increase in yields of 1.1 percent for passenger and 0.9 percent for cargo and oil at $72 per barrel.

“This is not a short-term shock. Conserving cash, careful capacity management and cutting costs are the keys to survival. The global economic storm may be abating, but airlines have not yet found safe harbor. The crisis continues,” said Bisignani.

Industry revenues for 2009 are expected to fall by $80 billion, some 15 percent to $455 billion compared with 2008 levels.

The worldwide economic recession will produce combined 2008-2009 losses of $27.8 billion for the world’s air carriers, worse than the impact of 9/11 when the industry lost $24.3 billion in 2001 and 2002.

Passenger traffic is expected to decline by four percent and cargo by 14 percent this year as both markets remain weak. Yields are expected to fall 12 percent for passenger and 15 percent for cargo in 2009. The slip in passenger yield is prompted by a 20 percent drop in demand for first class/business cabin accommodations.

The ancillary fee, or a la carte fee mania, got started last year as most airlines started charging baggage handling fees for domestic flights and some international trips. Other fees for meals, beverages and snacks, blankets and pillows, booking passage, changing reservations, and preferred seating followed soon after. And to add insult to injury, some airlines are hitting passengers already paying to check luggage a few dollars more to pay at the airport instead of online.

Southwest created a marketing campaign around its decision to not charge checked luggage fees for the first two articles. But Southwest has implemented other fees to generate more income while stubbornly defending its ongoing luggage fee policy against the advise of airline analysts who say Southwest could and should institute checked bag fees along the lines of rivals to generate as much as $500 million annually.

USA Today reported that based on Department of Transportation (DOT) statistics, in the first six months of this year, U.S. air carriers collected $3.8 billion for checking bags, canceling or rebooking flights, carrying pets and assigning seats. That’s up from $2.3 billion for the first half of 2008.

Checked bag fees are the most lucrative source of the extra revenue.

The U.S. airline industry collected almost $670 million in baggage fees in the second quarter of 2009, up 18.2 percent from the $566 million collected in the first quarter of 2009 and up 276 percent from the $178 million collected in the second quarter of 2008.

Beginning in the second quarter 2008, most of the scheduled passenger carriers began charging for the first and second bags checked by passengers. Previously, additional charges were not applied until the third bag was checked.

American collected $118.4 million in the second quarter of 2009, the most of any carrier although Delta was only $86,000 behind in baggage fees revenue.

USA Today noted that bag fees aren’t the only lucrative source of new income.

Revenue from fees imposed for canceling or rebooking flights rose 52% in the second quarter to $606 million. Revenue from miscellaneous fees — for assigning seats, flying pets and fees paid to the airlines for collecting airports' passenger facility charge — totaled $673 million in the second quarter, up from $565 million a year ago.

Air Tran expects to generate $300 million this year from ancillary fees while United hopes to clear $275 million from baggage fees. US Airways said it a la carte initiatives should bring in $400-$500 million this year.

USA Today reported that it took a week for its reporter — who, unlike most consumers, was assisted by airline public relations staff — to compile 28 different types of fees charged by 14 major airlines.

The proliferation of new fees is making it hard for passengers to keep track of them and which air carriers are assessing the ever-expanding array of fees for services that once were included in the price of an airline ticket.

Southwest, which flies more passengers within the U.S. than any other carrier, last June began offering customers the option of bringing small pets in the passenger cabin for a $75 fee. At the same time, it introduced a $25 fee for unaccompanied minors and doubled to $50 the fee for checking a third piece of luggage.

Southwest doesn’t let customers reserve seats in its one-class passenger cabin, causing ticket holders to scramble for the best seats. It does sell Business Select tickets allowing purchasers to board first. With the latest wrinkle, passengers who pay $10 more board after Business Select holders. The new ten-buck charge is expected to generate $75 million in additional revenue for Southwest each year.

Meanwhile, fees to check bags on international flights are creeping in and up. In recent months, all the major U.S. airlines have added $50 fees to check a second bag on flights to Europe. Two air carriers are charging second-bag fees for flights to Latin America.

A month ago, U.S, airlines began ratcheting up their domestic bag check fees. U.S. Airways is now charging $20 to check the first bag, $30 for the second.

And they just keep on coming.

Just this past week, British Airways said effective Oct. 7 it would start charging business and economy-class passengers to reserve seats more than 24 hours in advance of their flights.

Meanwhile, American, United, Delta and U.S. Airways has added a $10 surcharge for travel on three busy days around the Thanksgiving and New Year’s holidays.

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