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Icelandair Introduces New Low Fares, But a Sky-High Bag Fee


Since the advent of so-called unbundled fares, consumers have gradually come to accept (if not appreciate) trading ultra-low fares in exchange for a slew of additional fees, for everything from pre-assigned seats to carry-on bags. The airlines tout basic fares as maximizing consumer choice, but some consumers gripe that they’re complicated, and in many cases end up costing more than traditional, more inclusive tickets.

The latest iteration of basic fares was introduced this week by an unlikely carrier: Icelandair. The Iceland-based airline has long been known for its very low fares between the U.S. and Europe, via its Reykjavik hub. Its new Economy Light fares are not completely unbundled, but they make a point of not including a checked bag. For checked bag privileges, passengers will pay $69 each way to Reykjavik, and $95 each way from the U.S. to other European destinations. The new fares do include pre-assigned seats, a carry-on bag up to 22 pounds, gate-to-gate Wi-Fi, and free non-alcoholic drinks.

As of this writing, Icelandair’s website has not been updated to include the new Economy Light fares, so it’s not yet possible to compare them to the airline’s other coach fares, or to the fares of competing airlines.

The new fare will allow Icelandair to better compete with WOW, an ultra low-cost carrier also operating from Iceland, and Norwegian Air. WOW began flying to the U.S. in 2015, and will serve 13 U.S. destinations by next spring. Norwegian is also expanding aggressively. Both offer extremely low fares between the U.S. and Europe.

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After 20 years working in the travel industry, and 15 years writing about it, Tim Winship knows a thing or two about travel. Follow him on Twitter @twinship.

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