Domestic Airfare Prices Falling

By Author: Steve Robinson
Total Articles: 467
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In what is certain to delight people who highly value cheap airplane tickets and cheap vacation packages the government announced last week that the average U.S. round trip airfare declined almost 4 percent to $378 in the second quarter of 2013 compared to the prior year.

The highest average ticket price from among the busiest 100 U.S. airports was $547 in Huntsville, Alabama, followed by $518 in Cincinnati. The cheapest was $159 in Atlantic City, according to the U.S. Department of Transportation.

The price comparison included base ticket prices as well as all taxes and fees charged by government agencies and airports. Not included were optional fees such as baggage fees.

Pessimists will probably greet this news with little enthusiasm claiming that after so many price increases in recent years, that a price drop in a single quarter of one year means little. However, the opposite is in fact the case.

Airfare prices have fallen appreciably since 1999 when inflation is taken into account. The average ticket price in the second quarter of this year was over 18 percent less than in 1999 when the record ...
... price for airfare was recorded in inflation adjusted dollars. Total consumer prices have increased almost 41 percent since that time.

The continuing challenge to making air travel affordable is optional fees. Such fees continue to be an increasing source of revenue for airlines and a growing cost for passengers. U.S. airlines earned almost 88 percent of their revenue from base ticket prices in 1990. This year such base ticket prices accounted for less than 71 percent of their revenue.
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