If you’re planning your summer vacation, you’ve probably noticed the surprisingly high cost of plane tickets. Despite recent government efforts to regulate airline “junk fees,” understanding how flight prices are determined can still feel like a mystery. To shed light on this, we consulted with industry experts: Ryan Ewing, founder of AirlineGeeks; Anton Radchenko, CEO of AirAdvisor; and Mercedes Zach, a travel agent at ASAP Tickets. They helped us break down the complex factors contributing to expensive flights and shared advice on how to find better deals.
According to Ewing, flight pricing is far from simple. “Departments have hundreds of people that do pricing, and it’s a very complex process.” He also points out the impact of broader economic trends. “Like anything in the world, inflationary factors are creating a situation where pricing is a bit higher, and airlines are no stranger to that.”
Let’s delve into the specifics of why flights are currently expensive and explore strategies to save money on your next trip.
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Decoding Airline Taxes and Fees
A close look at your online airfare breakdown often reveals a relatively affordable base fare. However, the total cost can nearly double due to added taxes and fees. These charges fall into two main categories: government-imposed taxes and fees, and carrier-imposed fees. Government taxes are designed to fund various aspects of air travel and security, including:
- Passenger Fee: A standard $5.60 fee.
- September 11 Security Fee: Dedicated to enhancing aviation security measures.
- Air Transportation Tax: A percentage-based tax on the fare.
- Federal Segment Fee: Charged per flight segment in your itinerary.
- Facility Charge: For airport infrastructure and services.
The exact amounts for these taxes can fluctuate based on your departure and arrival airports, layovers, and whether you are flying domestically or internationally.
Ewing highlights the impact of tourism taxes in certain countries. “Certain countries have pretty substantial tourism taxes, so those will definitely hide in your ticket,” he explains. Examining your raw ticket after purchase can reveal the extensive list of taxes added.
The difference in taxes between domestic and international flights is significant. Consider these examples based on Delta Air Lines fares:
Domestic Flight Example (New York City (JFK) to San Francisco (SFO), one-way, nonstop, main cabin):
- Base fare: $337.67
- U.S. Transportation Tax: $25.33
- U.S. Passenger Facility Charge: $4.50
- U.S. Flight Segment Tax Domestic: $5.00
- U.S. Passenger Civil Aviation Security Service Fee: $5.60
- Total fare: $378.10
In this domestic example, taxes and fees amount to $40.43 on a $337.67 base fare, approximately 12 percent of the total cost.
International Flight Example (JFK to London (LHR), round-trip, main cabin):
- Base fare: $338.00
- Carrier-imposed international surcharge: $245.00
- U.S. Passenger Civil Aviation Security Service Fee: $5.60
- U.S. International Departure Tax: $44.40
- U.S. Passenger Facility Charge: $4.50
- U.S. APHIS Passenger Fee: $3.83
- U.K. Passenger Service Charge Departures: $60.80
- U.S. Customs User Fee: $6.97
- U.S. Immigration User Fee: $7.00
- U.K. Air Passenger Duty: $109.50
- Total fare: $825.60
For this international flight, taxes and fees surge to $487.60 on a $338.00 base fare, more than doubling the ticket price. To potentially reduce these costs, consider alternative departure or arrival airports or routing through different countries with lower tourism taxes.
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Key Factors Influencing Higher Flight Prices
Beyond taxes, several other elements contribute to the current high cost of air travel. Carrier-imposed fees, often related to fuel costs, are a significant factor. These are especially noticeable when using frequent flyer miles for award tickets.
Radchenko from AirAdvisor points to rising jet fuel prices as a crucial element. “The International Air Transport Association… is estimating the cost of jet fuel to rise to $2.70 per gallon, up from an average of around $2.66 per gallon in 2023.” He also notes American Airlines’ SEC filing indicating expected fuel costs between $2.80 and $2.90 per gallon, a significant increase from previous projections. Airlines are likely to pass these increased fuel costs onto consumers through higher fares or fuel surcharges, ensuring their profitability isn’t diminished.
Seat availability is another critical determinant of flight prices. According to Zach, “global seat capacity for 2023 was just 3.7 percent behind 2019… and already in the first quarter of 2024, OAG expects it to be 2.9 percent ahead.” This suggests a potential stabilization or even decrease in airfares as capacity recovers.
However, the ongoing issues with Boeing aircraft introduce uncertainty. The safety concerns and performance issues with the Boeing 737 Max have led to fleet adjustments for airlines like United and Southwest, impacting seat availability. Ewing remarks, “I always say it’s a pretty bad day when the consumers start to realize what aircraft types they are flying on.” Some travelers are actively avoiding flights on these aircraft, utilizing search engines to filter out Boeing planes.
Ewing further explains the impact of reduced aircraft deliveries. “Both United and Southwest have cut their planned aircraft delivery in 2024 in half, roughly… That’s substantial because… they’re planning their capacity growth with those additional airplanes from Boeing in their fleet. And now that that’s been cut by roughly 50 percent, there are fewer seats in the marketplace than what they were originally planning.” This reduction in seat supply, coupled with high travel demand, especially during peak seasons like summer, naturally drives up flight prices based on basic supply and demand principles.
Labor shortages within the travel industry also play a role. Zach explains, “Another reason behind increased airfare prices in the previous years was the staff shortage across the travel industry, from pilots to flight attendants and maintenance technicians.” Pandemic-era layoffs have not been fully reversed, leading to staffing gaps across airlines and airport service providers. Higher labor costs and reduced staffing capacity can translate to fewer available flights and increased ticket prices.
The long-term nature of resolving these shortages is emphasized by Zach, referencing an International Civil Aviation Organization (ICAO) estimate: “by 2026, the aviation industry would require 480,000 new technicians to maintain aircraft and over 350,000 pilots, and that can take up to a decade to fully resolve.”
Practical Tips for Saving Money on Flights
Despite the factors pushing flight prices up, there are effective strategies to mitigate costs. Flexibility is key. As an experienced full-time traveler attests, adjusting travel dates by even a day or considering nearby airports can lead to significant savings. Exploring less popular destinations or traveling during the off-season can also substantially reduce both airfare and accommodation expenses.
Ewing recommends utilizing flight search engines for thorough research. “Nowadays, Google Flights is probably one of my favorites where you can really scale it down based on several filtering factors, so I use that for sure.” Google Flights and other similar platforms are excellent tools for comparing prices and identifying potential destinations, especially if your travel plans are flexible. The “anywhere” feature on Google Flights allows you to explore flight costs to various locations from your departure airport, uncovering potential deals.
Considering budget airlines can also lead to savings. “I think there’s a stigma around airlines like Spirit and ultra-low-cost carriers, but nowadays they’re certainly offering a better premium product than they were,” says Ewing. Airlines like Frontier are even introducing enhanced seating options like “UpFront Plus,” offering more space at a lower cost than traditional first-class fares. These airlines allow travelers to customize their experience and potentially save significantly.
Finally, strategically using frequent flyer miles can minimize costs, especially regarding taxes. For example, the JFK to SFO flight mentioned earlier might cost 20,500 Delta SkyMiles plus only $5.60 for the September 11 tax, eliminating a significant portion of the taxes and fees. However, be aware of potential fuel surcharges on award tickets, depending on the route and airline.
While flight prices are currently elevated, being informed and proactive can help you find better deals. When you spot a good fare, it’s advisable to book promptly, as prices can change rapidly and favorable deals may not last.
