Travelers planning summer vacations may have a difficult time with rising airfare prices. Industry insiders advise cutting costs through major givebacks. Explore scheduling alternative itineraries with great flexibility or be willing to spend a few extra days on the ground. The current airline industry experiences double-digit increases in prices. Because of that, there likely will be fewer flight deals this year than in years past.
Katy Nastro, a domestic fare specialist, has seen the most massive increase in domestic fares she’s ever witnessed. As we highlighted with some recent data, that translates into a median average fare that spiked by about 18% last summer. And now airlines are ringing the alarm bell at the prospect of an increasing onslaught of airfare. Contributing to this reversal is the impact of the War in Iran and rising oil prices.
Those ticket price increases are primarily driven by the skyrocketing price of jet fuel. Since the Iran conflict kicked off, jet fuel costs have jumped more than 70%. United Airlines CEO Scott Kirby highlighted the necessity for airlines to increase ticket prices by approximately 20% to offset these rising costs. When fuel costs increase, the aviation industry has a history of responding by increasing ticket prices. They can do this by including surcharges to offset these higher expenses.
Nastro says while deals on flights might not be as frequent this year, travelers shouldn’t give up hope on saving money. “We preach the Goldilocks Window on when travelers should buy flights,” she said, suggesting that now is an ideal time for consumers to secure their summer travel plans.
“However with this year’s curveball of spiking oil prices, unpredictability is the only thing certain for airfare these days. The only predictable thing travelers can do now is lock in their airfare before prices creep even higher.” – Katy Nastro
It’s often a savvy decision to book a flight with a layover if it saves money. It’s critical for travelers to be aware of the other limitations that accompany basic economy fares. These fares have particular sunk cost restraints if prices fall post-purchase. Nastro recommends setting a Google Flights price alert which allows travelers to receive credits if fares decrease post-purchase.
Typically summer Tuesdays are the quietest and cheapest days to travel by air. If you have some leeway in your travel schedule, then you’re in for even more savings! Nastro emphasizes the importance of flexibility in travel plans: “Travelers may need to make more concessions this year if they don’t want to shell out more.”
Consumers would do well to consider the larger economic intolerance of high/sky-high airfare. If increased ticket prices discourage millions of Americans from flying, it will result in billions of dollars in decreased economic activity within the broader travel ecosystem. As the pandemic taught us, Nastro points out, sometimes prohibitively high fares lead people to travel less frequently. This would result in deflation—or at least a discouragement of spending.
“It’s no wonder airlines are raising red flags around rising oil prices and being pretty vocal about it. If one of their biggest expenses rises, they are going to look at ways to mitigate the impacts, and history has shown that one such way is to try to pass some expense onto consumers.” – Katy Nastro
