Economy-class passengers travelling to the Caribbean, the US, Mexico and within Canada on Air Canada, will now have to pay CAN$25 for luggage.

According to Air Canada, those travelling on Flex and Latitude Economy-class fares, or Altitude Prestige, Elite and Super Elite members, will not be affected.

Business class travellers, Star Alliance Silver and Gold members, military personnel or anyone booking with Air Canada Vacations have also been spared.

“We’re matching the market,” the airline’s chief financial officer Michael Rousseau told an investor conference last week. “It’s what the market is bearing at this point in time.”

The airline said about 20 per cent of its Canadian customers will be subject to the new fee, which represents the equivalent of about five per cent of Air Canada customers system-wide.

It’s believed the new fees could bring in between CAN$50 million and CAN$75 million a year in new revenue for the carrier.

Analysts had been expecting the move, especially after WestJet moved first, according to the Canadian Broadcasting Corporation (CBC).

It’s believed the new fees could bring in between CAN$50 million and CAN$75 million a year in new revenue for the carrier.

The airline is expected to see about a US$50-million bump in its revenues from the fee in the first year, but according to analysts, who said it comes with a “possible upside for travelers”.

Almost all major North American carriers now charge for checked baggage, with the notable exceptions of JetBlue and Southwest.