Airports lose revenue as travelers shun carts
LOS ANGELES — The rolling revolution in suitcases is idling those airline terminal luggage carts — costing airports and cart rental companies millions of dollars in lost revenue.
The demand for airport luggage carts, which has been steadily declining with the growing popularity of wheeled luggage, has dropped further now that airline baggage fees are forcing passengers to travel lighter.
At Los Angeles International Airport, cart rentals once provided at least $2.75 million in annual revenue. Now, the airport is losing nearly $1 million a year under a deal that obligates it to provide free carts to foreign travelers.
The same scenario is playing out across the country. Airports in New York; Tampa, Fla.; Seattle; Phoenix and Las Vegas are among those saying cart concessions either aren't the cash cows they used to be or have turned from a source of income to an expense.
"That is the nationwide trend: More and more people don't use luggage carts," said Sven Stohn, chief executive of Bagport Group, which runs cart rentals at airports in Philadelphia, Boston and Phoenix. "Through the past two years, I think revenue has dropped up to 23 percent."
Easy-rolling luggage and airline baggage fees get most of the blame.
Wheels have been on suitcases for decades, but the design took off after Northwest Airlines pilot Bob Plath came up with the idea for a suitcase in 1987 with built-in wheels and an extendable tow handle.
"All of our luggage has wheels on them, except the small carry-on bags," said Stephanie Goldman, a spokeswoman for Samsonite, one of the world's largest luggage manufacturers.
And now that passengers are packing fewer belongings to avoid airline baggage fees, travelers say it is largely unnecessary to pay between $3 and $5 to rent airport luggage carts.
Jim Slade of Huntington Beach, Calif., recently flew from Los Angeles to Montana to visit friends for five days. There was a time when he might have packed a big suitcase. But with the advent of luggage fees, he made do with a small carry-on bag with built-in wheels.
"Now that the airlines charge to check bags, I fly with less," he said.
Near the Delta Air Lines counter at LAX recently, Jessica Laub of New York had just arrived for a visit with family, pulling a suitcase on wheels and a carry-on bag. She said she packs very little to avoid luggage fees — and even left a pair of skis with her family in Los Angeles to avoid paying to bring them back and forth with her to New York.
"I haven't used a cart in years," she said.
Smarte Carte Inc. is the nation's largest luggage cart rental firm, serving at least 150 airports in North America. The St. Paul, Minn.-based company declined to discuss rentals, but a glimpse into its falling fortunes was recently provided by the Burbank-Glendale-Pasadena Airport Authority, which runs Bob Hope Airport.
Airport officials say Smarte Carte asked for more favorable terms for its cart concession, saying the privately held company has seen revenue drop 30 percent nationwide since 2007.
The airport authority agreed in April to cut from 24 percent to 10 percent the percentage of gross revenue Smarte Carte pays the airport to rent carts. The change will slash annual revenue paid by Smarte Carte from $57,000 to about $9,660, officials estimate.
Airport officials see little chance that luggage carts will come back into fashion anytime soon. In addition to adding wheels and collapsible handles, luggage makers have also reduced the size of most bags to help passengers avoid the fees charged by airlines to check bags or to haul overweight luggage.
The fees are substantial. In 2010, the nation's largest airlines collected $3.4 billion in fees from passengers who checked luggage, a 24 percent increase over 2009, according to federal statistics.
"Sales of big, oversize bags and cases are definitely on the decline, especially in the last few years as airlines have vigorously enforced overweight and oversize baggage fees," said Michele Marini Pittenger, president of the Travel Goods Association, a trade group for luggage manufacturers and other travel products.
Stohn, the Bagport luggage cart CEO, said he hopes his company will thrive by branching out into other airport services. For example, his company operates the lost-and-found desk at London's Heathrow Airport. Smarte Carte also operates massage chairs and cellphone charging stations at many airports.