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Air Fares Hit Record HighJuly 27, 2012 By: Newswire Travel Agent
Average domestic air fares rose to $373 in the first quarter of 2012, up 4.8 percent from the average fare of $356 in the first quarter of 2011, the U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) reports. Cincinnati had the highest average fare, $526, while Atlantic City, NJ, had the lowest, $157.
Not adjusted for inflation, the $373 first-quarter 2012 average fares reached an all-time high for any quarter, BTS says. The previous high was $370 in the second quarter of 2011. The previous first-quarter high was $356 in 2011. First-quarter 2012 fares were $246 in 1995 dollars, down 19.2 percent from $304 in 1999, the inflation-adjusted high for any first quarter since the beginning of BTS air fare records in 1995 .
BTS reports average fares based on domestic itinerary fares. Itinerary fares consist of round-trip fares unless the customer does not purchase a return trip. In that case, the one-way fare is included. Fares are based on the total ticket value which consists of the price charged by the airlines plus any additional taxes and fees levied by an outside entity at the time of purchase. Passenger airlines collected 69.5 percent of their total revenue from passenger fares during the first quarter of 2012, down from 87.6 percent in 1990.
Air fares in the first quarter of 2012 increased 9.6 percent from the first quarter of 2000, not adjusted for inflation, compared to an overall increase in consumer prices of 34.0 percent during that period.
In the 17 years from 1995, the first year of BTS air fare records, air fares rose 25.6 percent compared to a 51.5 percent inflation rate . The average inflation-adjusted first-quarter 2012 fare in 1995 dollars was $246 compared to $297 in 1995 and $301 in 2000. BTS air fare records begin in 1995.
Five highest and five lowest average fares in the first quarter: Cincinnati, a market with a high representation of business travelers, had the highest average fare, $526, while Atlantic City, a leisure-dominated market, had the lowest, $157.