Airfares Sinking Due To Lack Of Demand

The crappy economy is taking its toll on airfares. Demand is sinking taking airfares with it, says USAToday.

To assess the fare sales, FareCompare.com on Sunday analyzed airfares for the 25 most-traveled domestic routes in the continental USA.

On more than half the routes, non-stop coach tickets were available for travel on Dec. 10 for less than $220 round trip.

Prices were higher for travel closer to Christmas but still relatively inexpensive. For travel on Dec. 24 and returning five days later, for example, non-stop tickets were available on most routes for less than $270 round trip.

“Those holiday prices would have been double eight to 12 weeks ago,” Seaney says.

Ray Neidl, an industry analyst for Calyon Securities, says passenger demand is “down sharply” because of the weak economy.

Just because fares are going down, however, doesn’t mean you’ll be saving any money. Many fares, while cheaper than they were a few months ago, are still higher than last year — and the new airline fees appear to be here to stay.

A passenger with a $200 ticket may pay up to $80 more round trip for two checked bags — a 40% increase on what they paid a year ago, USAToday points out.

Economic woes push ticket demand down, airfares lower [USAToday]
(Photo: flyingember )

Comments

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  1. homerjay- Smiling politely says:

    Did someone say BAILOUT???

    Ugh… Probably.

  2. ScubaSteveKzoo says:

    I need help paying off my student loans. I think I’ll ask for a bailout. Seems easier than actually paying off debts.

  3. thebluepill says:

    Yeah, but fuel prices should be less than half for these airlines, unless they negotiated year-multi-year rates for fuel.

  4. Jonbo298 says:

    Lack of Demand due to FEE’S. Airlines are acting like the oil industry. They think they can get away with raising prices because its a “necessary commodity” for some, until they realize we all DO have a breaking point where we look and realize “Do we really need to visit out of state family every Thanksgiving/Christmas/other important dates”.

    • ViperBorg says:

      @Jonbo298: Or, hell, at this point, it may be just less expensive to drive.

      • BrianDaBrain says:

        @ViperBorg: I was about to say that with gas prices down significantly and airlines still charging those fees they promised us were only there because of high fuel prices, it’s probably more cost-effective to drive.

    • nybiker says:

      @Jonbo298: +1.

      I suggest we set up our relatives with a webcam. That way we can see ‘em and hear ‘em (of course, this assumes we actually want to see and hear ‘em).

      I’m glad my brother is only a 90-minute (or maybe 2 hours tomorrow) drive away and he & his wife are doing the cooking for the all of us. If I had to fly, I’d say, John, turn on the webcam and I’ll am mine at our Butterball and you aim your webcam at your Butterball. See, isn’t it great to spend time with one’s family?

      /end of family musings.

    • TechnoDestructo says:

      @Jonbo298:

      Wait, lack of demand due to fee’s WHAT? I mean it’s fee’s something, but you neglected to specify.

      • cjones27 says:

        @TechnoDestructo: Ah, a grammar Nazi. You’re correct, obviously, but is that really necessary? Let’s just enjoy Thanksgiving and keep the correcting/snide remarks/conflict for where it belongs: with our in-laws tomorrow!

  5. yevarechecha says:

    I flew on Northwest yesterday and was not charged for my checked bag. The people on either side of me were, but the kiosk said my bag (40-lbs. rolling duffel) was $0 and the agent checked it through without asking for payment. So now I’m confused. I think I bought the ticket in March; if you purchased before the fee policy went into effect, is your bag grandfathered in for free or something? I had my credit card out to pay the $15 and it never happened.

    • nybiker says:

      @yevarechecha: IIRC, yes you are/were grandfathered (or grandmothered, if you prefer).

    • thetango says:

      @yevarechecha: “So now I’m confused.”
      I was wondering the same thing so a while ago I called NWA to ask about the baggage policy and was told that tickets purchased prior to July 10 2008 (I’m not 100% sure on that … I think it was the tenth) did not incur the $15 first bag fee.

      Hope this helps…

  6. nicemarmot617 says:

    It’s true, I’ve purchased two round-trip tickets in the past few weeks and they were both significantly cheaper than I was expecting. The airport was still pretty crowded last weekend, though. There were definitely plenty of people flying.

  7. nerdychaz says:

    Spend $500 to fly across half the country, or just make a phone call and say, Happy Thanksgiving!

    Hmmm, hard decision, plus I hate my extended family.

  8. Anonymous says:

    Don’t I already own airline stock since I paid taxes that went towards their last bailout? Oh wait, it doesn’t work that way.

  9. Atticka says:

    Soo….it has nothing to do with the drastic drop in fuel prices?

    • Snarkysnake says:

      @Atticka:

      Ha Ha. Fuel prices may have dropped for you and me, but like a bad dream , the dimwits at the airlines locked in the old , higher fuel prices earlier this year and won’t see the real benefit of lower prices until their hedges expire sometime next year.Until then , they are still bleeding money out of every orifice because they tried their hand at oil speculatin’.I sure don’t want a oil exec flying my plane . What makes them think that they know anything about petroleum ?

      • Atticka says:

        @Snarkysnake:

        Well that was a silly move!

      • johnnya2 says:

        @Snarkysnake: SWell they actually DO need to do this because though you buy a ticket in say March and don’t fly until October they have no idea what to charge for what the actual fuel cost will be. SWA has 17 consecutive years of profitability due to fuel hedges. Teh other airlines did not hedge with nearly the same gusto and guess what, they have filed for BK or started charging for bags etc. The hedgers are actually usually pretty good. BTW, jet fuel is not the same as filling up your car. I would also point out if the economy turns around fuel prices will again skyrocket

  10. Grrrrrrr, now with two buns made of bacon. says:

    But it’ll still cost you $400 extra if you check two bags and want a pillow and a soft drink.

  11. Onion_Volcano says:

    bah, people still fly. The new fees are retarded but how are you going to get from one side of the country to the other? Or overseas? you fly duh so you are stuck with the airlines.

    • thebluepill says:
      • Kajj says:

        @thebluepill: I don’t think they’ve got buses or trains running across the ocean yet. And if you’re planning to run across the atlantic, let me know so I can be there to watch.

      • johnnya2 says:

        @thebluepill: Why are people so dense that they never factor in TIME. TIME IS MONEY. If I drove from Detroit to Florida it would require about 24 hours of driving if I went straight through. If I take a flight it would cost me about 4-5 hours of time. Lets pretend it took 10 hours, That is a 14 hour advantage. Flying is a value when you realize your time is worth something

        • thebluepill says:

          @johnnya2:

          True, Time is a huge Factor, and the reason I fly when going international a couple of times per month. Driving would take me 2 days, where a 3 hour flight becomes worth the money.

          But, its the Sub 500 mile flights the become a gray zone.

          Factor in 20min-1hour to get to the airport and get inside, potentally 1 hour to check bags or get tickets (if you dont e-ticket), 20min-1.5 hours in security.. Wait 30min-1 hour to board.. flight time up to 1.5 hours.. landing, departing the airport and getting transportation..

          Realistically, even for a short hop flight, you are out 3-5 hours minimum, even 8 on a busy day or with delays.. Taking connections can even make it 12+ hours.. (yeah, Ive left work at 1pm for a 4pm international flight, with a connector, ive made it home several times at midnight.. and these were opimal flights..)

          Traveling with more than 2 people, less than 500 miles.. flights start to loose their appeal rapidly, especially if its out of your pocket.

          • ROCKYLIFE says:

            @thebluepill:
            If you are actualy missing out on economic opportunities during longer travel times, then time is a “value” factor. IF you are traveling for business, otherwise your time has no “value”, otherwise, you are simply feeling inconvenienced by the time consumed.

            Most people highly overrate the “value” of their time.

        • the_wiggle says:

          @johnnya2: thank u for pointing this out! my time is my life & thus worth considerable $$.

          to me at least.

          and having been on numerous family roadtrips – bring on the plane!

          • ROCKYLIFE says:

            @the_wiggle:

            Nope, sorry. But your “life” is not actually worth ANY $$$, sorry to say. It certainly has VALUE to YOU, but it does not have any monetary value in itself.

            Only when you are generating some actual economic activity is your time “worth anything”.

            People make this mistaken calculation quite often.

        • ROCKYLIFE says:

          @johnnya2:
          People don’t “factor in time”, because unlike you, they know that only a very limited amount of one’s time is “valuable” in a 24 hour day, much less on vacation when it has ZERO value.

          Let’s say that you are so brilliant and efficient during the work day, that you contribute 8 hours of value to your employer. (In reality, most workers are efficient for 4-6 hours during any one day, but we’ll pretend that you are superman.)

          Those 8 hours have an economic benefit to your household. However there are more 16 hours of your day that are economically worthless. You do nothing to generate income. (or maybe you do something on the side, but during time allocated for vacation, all 24 hours of each day are economically shot, so it doesn’t matter)

          You are not going to work during the “saved time” during your travels, so you have NO 14 hour “value advantage”. Your free time has NO value whatsoever. Now if you feel bored or frustrated in longer travel times, then that’s another issue.

          It is a common fallacy to attach value to every hour of one’s day. Unless you have your own company or are a salesman, and you are scouting new clients/customers all the time, your time is typically worth not only less than you think, but actually ZERO.

    • NVsinner says:

      @Onion_Volcano: yes, because EVERYBODY NEEDS to travel cross country ALL THE TIME.

      the few who dont need to, choose not to, and would have last year far outnumber those who actually NEED to.

      but there certainly is not enough passenger traffic in the US right now to sustain all of the US carriers for an extended about of time, especially at the fuel prices United hedged on.

  12. jamar0303 says:

    Lucky you. I’m trying to go Shanghai-Tokyo and it’s insanely expensive.

  13. Madjia says:

    I’m flying from Amsterdam to the US on Christmas day, it was the cheapest ticket I could find, especially since it was later in the day. Tickets for early flights on the same day were almost double when I booked two months ago!

    I’ll still be in time to spend Christmas evening with my boyfriend!

  14. chiieddy says:

    My husband and I signed up for a Course on how to pack for 3 weeks in Europe with one bag at the Boston Center for Adult Education. I hope it works and we master the art for our Italy trip in March because the fees really irk me!

    • Employees Must Wash Hands says:

      @chiieddy:

      I wonder if this course teaches you all the nuances about the “smell test.”

      Anyway, most airlines will let you check two free bags per person on international flights.

  15. xkevin108x says:

    The crappy economy AND the the lousy air travel service in addition to the TSA harassment and their onerous fees for everything is what’s killing demand. The feel-good security measures they employ don’t increase safety considerably for what they cost and the number of people they inconvenience. We took a trip from Norfolk to Orlando earlier this month and opted to drive instead of being subjected to the cesspool that air travel has become.

  16. Justinh6 says:

    Honestly, I check Southwest’s prices before anybody else.

    I’ll pay no fees, I’d be glad to pay a few bucks more for a nonstop flight to where I have to go, versus sitting in some airport in jersey for hours trying to go west.

    • Anonymous says:

      @Justinh6: concur wholeheartedly. i flew southwest a month ago to FL for some family stuff and while the seating setup takes some getting used to, its worth to not be nickel-and-dime’d to death. plus, the flight crews were a riot; not your formal boring selves. i live not far from a central usair hub (charlotte) and while i had little complaints with their service i refuse to pay for their fee-laden service… so for the forseeable future its southwest for me!

  17. dweebster says:

    The “fee” game they are playing is penny wise and pound foolish. If I can’t get a clear picture of my travel cost comparison, I will either rent a car and drive or opt with an airline that plays straight or not travel at all. They will just be back to screwing business travellers, and with the state of business lately – they’ll all be flying their *private* jets to Washington begging for our tax bailouts.

    Nice move, greedy airlines. Goodbye.

  18. FLConsumer says:

    Demand’s also going down because people don’t want to deal with nickel-and-dimeing(sp?) airlines who are never on-time and haven’t had good customer service since deregulation + the TSAholes. Get rid of those and I’d gladly fly more often, regardless of the price.

    • thebluepill says:

      @FLConsumer:

      Ditto on that.. Try Customs with the TSA.. its getting fairly bad..

      In the last few months Ive been through Customs 12 times, and pulled out of line 8 of those to have everything in my bags yanked out, patted down, screened.. the whole nine yards.. its just nuts..

      When I ask why.. same answer.. Its random..

  19. Anonymous says:

    I think the best thing about the Consumerist is the constant snark. 2 months ago, everyone was wetting their pants about what a great idea the airline fuel hedging was when gas was $5. Too bad the airlines don’t have your crystal ball/perfect hindsight, guys! Seriously, lighten up. We’ll just bail them out like we do every 3-4 years.

  20. Scatter says:

    I can’t seem to figure out airlines.

    When things get rough you read that they’re cutting flights. Now they report that they’re struggling demand. So what’s the story, do they want us to fly or not?

  21. axiomatic says:

    At this point I only fly if I have to. On top of that, I have no sympathy for the Airlines. How any company can run a national service BEGRUDGINGLY is completely beyond me. They seem to forget whom they are servicing.

  22. tailstoo says:

    Apparently this is not the case with Automotive CEOs – they need their private jets since they are a constant source of productivity. Just ask them.

  23. NeonNoodle says:

    @homerjay- Smiling politely:

    College 2009

    Business 101 first day.

    Professor: Hello students, welcome to business 101. Today we will cover…

    *Professor takes a sip of his coffee*

    Professor: Congratulations, you just completed business 101. Certificates at the door.

  24. Anonymous says:

    The Airline Industry proves that business degrees are not worth the paper they’re printed on. Who else would think that cutting planes and overbooking flights at Christmas (when people are less likely to skip a flight and more likely to encounter airport delays) is a great idea?

    Christmas Day at O’Hare – United had THREE flights to Phoenix. Up the road at Midway – Southwest had ELEVEN flights to Phoenix. Southwest ran on time; United ran late, overbooked by 20 seats per flight and left 45 people on standby at the end of the night (and of course with no offers of hotel accommodations).

    Guess who I’ll fly the next time I have to travel during the holidays: the airline run by morons or the one run by businesspeople?