If you’ve been searching the skies for air travel recently, you have probably been struck by the prices you see. Despite your best efforts to be flexible on travel dates and airports at the destination, you can’t seem to find that good deal you had gotten used to seeing.
So, why are flights so expensive at the moment? In the end, it’s not that complicated. There are tons of considerations that go into ticket prices, and in my never-ending quest to find cheap flight deals, I have learned a great deal about them.
Here, I’ll go through what makes flight prices go up and down due to many airline industry and world conditions. I’ll also detail how I use some tricks and tools to get cheap flights, like Skyscanner, Scott’s Cheap Flights, and more.
Why Are Flights So Expensive?
1. Higher Demand Leads to Fewer Cheap Flights
First of all, keep in mind that flight prices are subject to the same laws of supply and demand as any other product. When more people want to fly, even on specific routes, airlines know they can charge higher prices. When the opposite occurs, and fewer travelers are looking for tickets, airlines have to lower prices to sell more.
While your most recent memory of low demand might be from the pandemic, that is not the only situation that can raise or lower the desire to travel. It can be because of a range of things: weather, the season, natural disasters, large events… and so on.
The thing is: just because there is too much demand doesn’t mean that you can no longer find cheap flights. It just means that you may need to be ready to purchase your tickets when the flight schedules are released or purchase your tickets quicker. We use Going.com and are still finding incredible flight deals for domestic and international flights.
Demand Fell During the Pandemic
If you are here, you surely recall that the pandemic stopped the travel industry for some time. Whether it was forced due to lockdowns and closures or by choice because travelers didn’t feel safe, fewer people were looking for airline tickets in 2020-2021.
Naturally, flight prices plummeted (for the flights still taking off). This lasted for quite some time, and I was lucky enough to get a super-cheap trip to Greece thanks to these low prices in July 2020.
As the situation improved and borders opened up, the pendulum swung in the opposite direction. Demand skyrocketed, and those super-low ticket prices got harder to come by. My family’s trip in the summer of 2021 to visit me in Europe was significantly higher than in the past.
Seasonality Affects Demand
Forgetting all the fun of pandemics, demand goes up and down based on many more standard factors in the travel industry, such as the season.
Traveling anywhere in the weeks surrounding Christmas are always double, triple, or even more than their off-season counterparts, for example. Don’t forget to consider the seasonality at your destination, which might not specifically apply to you.
If you could only find time off from work during March and choose to fly to Japan to go to Disneyland Tokyo, you will, unfortunately, be impacted by the high prices of cherry blossom season even if you aren’t going for that reason. Conversely, if you can only get to Ibiza in the winter low season, you’ll enjoy the year’s best deals.
See Related: How to Book the Cheapest One-Way International Flights
2. Jet Fuel Prices Impact Ticket Prices
I’m sorry if you are tired of hearing about high gas prices on the news. Unfortunately, it’s a problem that extends far past your weekly fill-up and is one of the biggest contributors to higher fares on planes.
Airlines do have special strategies that help them get deals on jet fuel, called hedging, but it is not a complete shield from the curse of fluctuating oil prices. Higher fuel costs lead to higher ticket prices, and there is no great way around it.
We’ll get into the prior history of high fuel input, but let’s look at the general cost segments from the airlines’ perspectives to help frame the understanding. The numbers vary from airline to airline, but fuel will remain one of the largest input costs of any operating airline for the foreseeable future.
|Factor||Description||Approximate Percentage of Total Cost|
|Labor||The cost of salaries, benefits, and training for pilots, cabin crew, maintenance, customer service, and other employees.||30%|
|Fuel||The cost of aviation fuel is one of the largest expenses for airlines and fluctuate based on global oil prices.||25%|
|Airport Fees||Airlines must pay landing fees, terminal costs, and other charges to the airports they use.||15%|
|Aircraft Maintenance & Depreciation||The costs associated with maintaining the aircraft and depreciation over the life of the plane.||15%|
|Taxes & Regulatory Fees||Fees and taxes imposed by local and national governments, as well as international regulatory bodies.||10%|
|In-Flight Services||The cost of meals, beverages, in-flight entertainment, and other services provided to passengers.||5%|
The Case of Higher Jet Fuel Prices in the 2020s
One example we can easily look at is the massive dip, then spike, in oil prices in recent years. When the pandemic struck, oil prices plummeted to record lows.
Combined with the virtually zero demand for flight tickets, airlines were able to offer rock-bottom fares. But the oil market recovered relatively quickly. Price rises made fuel more expensive, which ate profit margins as demand recovered more slowly.
The geopolitical instability, thanks to the Russian invasion of Ukraine, has made things significantly worse, driving fuel prices to all-time highs and more demand on non-Russian flights due to the international shunning of Russian airlines. That’s why we are seeing some seriously expensive tickets in the aftermath.
See Related: How to Find Mistake Fares
3. Business Travelers Influence Flight Prices
The airline industry loves business travelers. They are not nearly as price-sensitive as leisure travelers, meaning airlines can charge them a higher price. They are also more likely to book the more expensive seats on the plane upfront, which yields more profit.
How does this affect you, a presumably non-business traveler? You’d be surprised that it does, and quite significantly. How many business travelers are on a flight affects how much money the airline makes and how much they charge everyone else.
The Impact on Non-Stop vs. One-Stop Routes
If you consider the typical business trip, it often involves connecting two major cities where companies are based. Since a business is less concerned with good prices and more concerned with convenient connectivity, airlines can charge premium airfares from these point-to-points.
Take a flight from London to San Francisco, a hugely popular route for business travelers in the tech industry. Simple round-trip routes between this pair are generally very high for direct flights and even more ridiculous in business class.
But notice how the price decreases significantly if you care about getting there and don’t mind a stop in a third city. This is an important observation if you care more about cheap fares than the inconvenience of changing planes – it can save you some serious cash.
See Related: Must-Know Vacation Tips to Maximize Your Trip Experience
Business class is called business class because businessmen and women on work trips often fill the cabin. The higher prices airlines can charge lead to more profit. Therefore, airlines will put business-heavy seat configurations on the appropriate routes to maximize profit.
An example is United’s choice to outfit some of their 767s in what is referred to as a ‘high-J’ format. They deploy these aircraft with more business class seats on routes with the most business travel.
This could help you save money: the more money they can make in the front of the plane, the lower they can reduce fares in economy class. While the logic works, this one isn’t always that simple as the supply and demand of individual cabins have a large impact, too.
See Related: Why So Many Flight Cancellations?
4. Avoiding Airspace Makes Airline Tickets More Expensive
The longer the airplane spends flying, the more fuel it has to use and the more the crew has to be paid; and the higher the price becomes.
And while you probably aren’t researching the route map to see how to direct the journey is, you can monitor world events and travel news to get an idea of what certain things will do to our beloved low fares.
See Related: Things to Know When Flying with Cash
Conflict Zones and Safety
Recently, one of your first thoughts might be the Russia-Ukraine crisis, which airlines must avoid. For example, flights from London to Delhi now have to make a major detour to avoid that mess leading to several extra hours of flight time and fuel.
There are many examples, though, and this type of calculation isn’t anything new. Most airlines have been avoiding North Korean airspace for many years due to the risks, which have major impacts on flights from Europe to South Korea and Japan. Afghanistan’s airspace has been closed since last summer, adding flight time to Indian destinations.
Bureaucracy and Red Tape
There doesn’t have to be a war or risk for an airline to take a strange route, however, so keeping up with world events won’t always signal prices for your next trip.
Planning a flight path is complicated and requires international cooperation, which is sometimes difficult. One example that comes to mind is the American Airlines flight from JFK to Delhi, which never used Russian airspace before the crisis.
This was because American Airlines could not request approval in time for the launch, as the Russian flight authorities only accept applications a few times per year.
They must therefore overfly Europe, Turkey, and Central Asia, adding several hours to the flight time and longer than their competitor United.
Due to distance restraints, the return flight to JFK has frequently required an unplanned refueling stop in Bangor, Maine. That can get expensive – and it’s passed on to your airfares!
See Related: Ways to Book the Cheapest First Class Flights
5. Airline Industry Competition Leads to the Lowest Fares
Going back to some basic economics, competition is good for the customer as it leads to the best prices. Maybe you’ve heard of some of the newest airlines in the US, like Avelo, Breeze, and Aha!, which have all appeared on the market recently.
The more they have to work to win customers with lower prices, the easier it becomes to find affordable flights. Beware that the opposite can occur, too, like the recently proposed Spirit-Frontier merger.
The Rise and Fall of the European Low-Cost, Long-Haul Carriers
The golden days of trans-Atlantic travel were when we had ultra-low-cost carriers like WOW Air, Norwegian, and Primera Air for less than $100 each way. No, it was not a particularly comfortable seat, and you had to pay for anything else, but how many people would turn down that price?
That was exactly why major airlines offering full service were forced to lower their fares and compete. Thanks to all that competition, you could get essentially any flight for the same price. It arguably also brought on the dreaded basic economy model that many full-service carriers have adopted, sadly.
As a result of unsustainable business conditions and then the pandemic, none of the above airlines exist anymore. That loss of competition drove transatlantic fares back up. Those ticket prices will be missed.
How do airlines’ dynamic pricing strategies work?
Airlines’ dynamic pricing strategies work by adjusting ticket prices in real time based on numerous factors. These include supply and demand, competition, booking time, seasonality, and market conditions. Using sophisticated algorithms, airlines continuously analyze these variables to set competitive prices to maximize revenue while ensuring flights are as full as possible.
Dynamics of a Route
As you might expect, if there is only one airline serving a particular market, that gives them the ability to charge the highest price possible. One example is that Fiji Airways is the only carrier to connect the island country to the US, making those flight prices particularly high. US airlines often complain about this as the Fijian government won’t allow competition.
On the other end of the spectrum, you have routes like Los Angeles to Honolulu, which nearly every airline in the US serves. These ticket prices are often exactly the same across the board, thanks to that competition.
See Related: Layover vs Stopover: What’s The Difference?
6. Domestic Flights May Be Cheaper Than International Flights
If cost is a concern when booking your summer trip to the French Riviera, it may be worth considering a passport-free trip to the beaches of Florida or California instead.
It’s sometimes the case that a domestic flight can be the better deal.
Not all airports in the US are equipped to handle international flights – there must be a Customs & Border Patrol presence, security standards, and more infrastructure. Smaller regional airports which don’t have all this have lower operating costs, and therefore airlines can offer lower flight prices to and from them.
Besides, you can have a cheaper experience at these airports anyway regarding parking and food. One notable example is the rise of Avelo at Tweed New Haven Airport in Connecticut, growing into an alternative to Boston and even New York.
Lower Taxes and Fees for a Lower Ticket Price
Even if you are flying to or from a major international airport, you can avoid certain taxes and fees attributed to flights leaving the US. Custom, security, and landing fee charges won’t apply to your flight.
See Related: What is a Hacker Fare?
How to Save Money on Airfare Costs
Those are just six big factors that can impact flight prices. While some of them are unfortunate things that we can’t help as a traveler, there are at least some tips and tricks to get the best prices, even when airline tickets seem to be sky-high.
Use Tools Like Skyscanner and Going.com to Find Cheap Fares
First, there is power in numbers, and you’ll need to search as widely as possible to find that cheap flight you need. Rather than searching airline websites, sets of dates one by one, and each destination one by one, make your life easier with a tool such as Skyscanner.
We’ve done plenty of articles on Skyscanner and how it aggregates all of the flight details mentioned above and puts them into one search to get you the best price. Save yourself hours in some cases by using this simple site.
To save even more hours, sign up for Going.com (Formerly Scott’s Cheap Flights) to get alerts every time there are crazy deals departing your city.
Consider Basic Economy Fares
While they are most hated, basic economy fares can be a decent solution for the right traveler. If you aren’t the kind of person who cares if you have to sit in the middle for a few hours, and doesn’t need a suitcase, and don’t mind packing your snacks, you can save a lot of cash on these tickets.
Compare Budget Airlines to Major Airlines Carefully
The above being said, if things like seat selection and ticket flexibility are important to you, weigh your options carefully.
A budget airline that offers a super-low fare but charges for everything else may come out costing the same or even more than a full-service carrier. You’ll have a more comfortable trip and earn frequent flier miles by catching that.
Use a Good Credit Card Strategy
Finally, don’t forget my all-time, number one, favorite travel tip. Use credit cards strategically and wisely! Many airlines offer a co-branded credit card which gets you perks like free bags, free seats, or even status. It’s the same logic as opening a credit card for a certain hotel chain.
Alternatively, you can still make a good decision if you don’t have one of these cards and aren’t in the market to open a new account. Most travelers have a credit card that provides travel perks like lost luggage or rental car insurance.
Some cards offer cashback on certain purchases. Know your cards and what they offer. This can directly or indirectly save you money and make your trip a whole lot better.
You can pair these with cashback shopping portals such as Capital One Shopping or Honey, where you will earn additional rewards, which translate directly into savings. Both are browser extensions, so it’s as passive as it gets to earn some form of money back on an expensive flight.
When will flight prices drop?
Flight prices will likely drop during off-peak seasons for your desired destination when the demand for travel decreases. Typically, this occurs during non-holiday periods and school terms when fewer people are traveling. Also, midweek flights, especially those scheduled during nighttime, are often cheaper due to lower demand.
Why are last-minute flights so expensive?
Last-minute flights are typically more expensive due to the principle of supply and demand. As the departure time approaches, the number of available seats decreases, causing airlines to increase prices. Moreover, less price-sensitive business travelers often book flights last minute, increasing the prices.
Does the age and efficiency of an airline’s fleet affect ticket prices?
Yes, an airline’s fleet’s age and efficiency can impact ticket prices. Newer, more fuel-efficient aircraft consume less fuel, lowering airline operating costs. These savings can sometimes be passed on to consumers through lower ticket prices. Conversely, older, less efficient planes can increase ticket prices due to increased maintenance and fuel costs.
Why do flight prices fluctuate so often?
Flight prices often fluctuate due to dynamic pricing strategies implemented by airlines. This system, driven by algorithms, considers factors like demand, competition, time of booking, and seasonality to adjust prices in real time. As these factors constantly change, so do flight prices.
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Find Cheap Flights
Use Skyscanner to find flight deals. As my personal favorite flight search engine, Skyscanner scours websites and airlines across the globe, leaving no stone unturned to help you find the best deal possible. And if you really want to take your savings to new heights, pair Skyscanner with Going (Formerly Scott's Cheap Flights). With access to exclusive mistake fares delivered straight to your inbox, you'll be packing your bags and jetting off on your next adventure before you know it.
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