They also charge it because hauling a live animal involves a lot more personnel, fees, risks, etc. Most airlines charge money for extra baggage, and a suitcase doesn't involve health checks or excess paperwork.
Not that the prices aren't ridiculous, but if you figure that, for the same space they use to ship my dog, they could probably pack in 5-10 suitcases (bringing in an extra $250+ for them with no real extra effort/staff required), and my dog will require extra staff at both airports (and the risk of heavy fines from various agencies if they screw up on his care during the flight, or inadvertently ship an unhealthy/uninspected animal)...the fees make more sense.
(Finally, there's the law of supply/demand. Most airlines I've talked to will ship only 4-6 animals per flight, which means getting your animals on a flight that works for you is harder/rarer, which means it's more valuable. And, people will pay silly amounts for animals they love.

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