Fancy Math Says Book 8 Weeks In Advance For Cheapest Flights

The cheapest time to get your airline tickets is 8 weeks in advance, says an economist who came up with a fancy formula, ∏A = gUG + min(k-g, (1-g)(1-r)), to figure it out.

Here’s a sample:

Prices for EasyJet flight booked in advance as of 21 August
London Stansted (STN) to Munich (MUC)

1 day = £82.99
1 week = £98.99
2 weeks = £62.99
8 weeks = £19.99
12 weeks = £25.99

Basically it comes down to paying for risk. When you buy tickets, you are taking the risk that you might later have to change your travel plans. The longer out you buy, the more likely it is something might crop up. Airlines offer advance purchase discounts in order to induce consumers to take that risk. Why the price dips at 8 weeks exactly, and then starts rising again, I guess you’ll have to read the latest edition of the Economic Journal to find out.

Why ∏A = gUG + min(k-g, (1-g)(1-r)) equals low airline fares [Observer via Lifehacker]

Comments

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  1. pecan 3.14159265 says:

    From what I gathered from the explanation, booking eight weeks early is good, but if you book too early it doesn’t necessarily mean you’ll pay more, it just means you might have unforseen problems that will cause you to miss your flight? I didn’t detect any explanation for

    I always book early, but this just doesn’t seem to me like a reasonable advice for how early to book, other than “you’ll pay more if you book sooner than eight weeks.”

  2. Underpants Gnome says:

    One thing I learned the hard way is don’t book while sleep deprived…. You could end up with an 8:50pm flight when you wanted the 8:50am, for which correcting would cost $175 a ticket on a $200 ticket. $#@%@$ you, United. Lets hope same-day standby works out.

  3. Toffeemama is looking for a few good Otters says:

    I guess the best strategy is to start looking at ticket prices a few months before the trip, then just keep checking the price.

  4. Bluefreak says:

    I work in this very area (including at an airline in the recent past), and there is a relatively simple explanation for this. People who buy tickets more than about two months out (three for transoceanic trips) are buying them specifically because they want to have their plans hammered down as soon as possible, for example to get to a wedding. Since the vast majority of people don’t start buying their tickets until about 60 days before a flight, why offer the “nervous nellies” the lowest fare if they are willing to pay a bit more for a sense of security?

    • katarzyna says:

      I also tend to buy early to ensure a decent seat in the front of the plane. I don’t mind paying a bit extra for security + better seating options.

      • IThinkThereforeIAm says:

        Sorry, buying your ticket early has nothing to do with seating assignments… it is usually affected by check-in order (and who’s more likable for the ticketing counter personnel).

        • myCatCracksMeUp says:

          Huh?

          Like I said, I don’t fly, but on some airlines, including American Airlines, you book your seats when you book your tickets.

        • smo0 says:

          No, that’s on flights with boarding groups, you can still purchase specific seats on some flights…

        • katarzyna says:

          Well, I’ve been able to select my seat(s) when booking for the past… I dunno, I can’t think of the last time I wasn’t able to.

        • IThinkThereforeIAm says:

          Admittedly this is for transatlantic flights, but I could NEVER ever specify the seat I wanted – and even when I called the airline, and asked for seat assignments at the gate they usually go into this big hew-haw and give me some completely different seats…
          Since I usually don’t like to spend hours at the airport I arrive and check in between 2 and 3 hours before the flight, and apparently by then they re-assign the seats to… their friends maybe(?).

      • myCatCracksMeUp says:

        I don’t fly, but when I recently bought my daughter and her family airline tickets to my son’s wedding, I bought them 4 months early so I could book four good seats all together on the flights with the most convenient departure times.

  5. Bob Lu says:

    “Why the price dips at 8 weeks exactly, and then starts rising again”

    I guess it is because for the flights longer than 8 weeks away, the airlines don’t want to sell the seat badly yet.

  6. ShruggingGalt says:

    That looks like the formula for traffic jams!

  7. pop top says:

    I looked at plane tickets last week from Michigan to Atlanta and they were $175 round trip. I looked at them yesterday, not even seven full days later, and they were $275! I’m afraid if I wait until the first week of October (approx. 8 weeks before the trip), that the tickets will be even more expensive.

    • myCatCracksMeUp says:

      Clear your cache and your cookies and try again. I’ve read (here, I think) that if you revist a reservation site and look at the same flights, the cost will almost always go up.

      • pop top says:

        Wow. I didn’t think that would actually work, but it did. The tickets went from $275 to $232. Obviously that’s not the $175 they were last week, but it’s still $50 cheaper. Crazy.

  8. dreamfish says:

    … except of course, based on this evidence being widely circulated, everyone is going to try to buy their tickets exactly eight weeks beforehand – which will skew the statistics and result in airlines raising prices around that time and thus negating the research.

  9. AllanG54 says:

    I call bull on this. I’m flying down to Orlando in the beginning of October and booked my tickets beginning of August. Next week later they were about $40 cheaper each ticket. What really determines price is how quickly the planes fill up. If the plane fills up six months in advance as when Thanksgiving holiday seats are being sold you can bet there’s not going to be any bargains eight weeks in advance.

  10. Marlin says:

    I thought Bing.com had something that tracks ticket prices? Does that work well or back this up?

  11. NarcolepticGirl says:

    Since I’m cheap and I travel to visit family and not usually for any specific event, I’ve always looked at ticket prices anywhere from 2 weeks away to 3 months away.
    With Jet Blue (but haven’t flown with them since I moved – about 2 years ago), the prices didn’t change that much unless there was a holiday.

    I’m not sure about all these other major airlines since I’ve only flown them once or twice.
    I’ll have to get used to dealing with them soon, though.