scorecardPlane tickets are finally cheaper right now. It won't last.
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Plane tickets are finally cheaper right now. It won't last.

Jacob Zinkula   

Plane tickets are finally cheaper right now. It won't last.
PolicyPolicy2 min read
  • The price of plane tickets fell 13% from October 2022 to October 2023.
  • But rising labor and fuel costs could lead to higher prices over the next year.

Flight prices are much lower than they were a year ago, but the good news for travelers won't last forever.

Between October 2021 and October 2022, airline fares increased by over 42%, according to the Bureau of Labor Statistics. Last year's sky-high flight prices were driven by a combination of pent-up demand from travelers after the pandemic and elevated fuel prices. A lower supply of flights — due in part to shortages of pilots, flight attendants, and air traffic controllers — also contributed to bloated prices.

But the airline industry has normalized a bit over the past year. Lower demand for domestic flights and the return of airlines' seat capacity to pre-pandemic levels have led some US airlines to compete for passengers by lowering prices. November's inflation report revealed that airline fares fell over 13% between October 2022 and October 2023. And while prices remain higher than they were two years ago — when pandemic factors were still keeping prices abnormally low — they're 5% lower than they were in October 2019.

"Travelers were taking extra trips, willing to spend a lot more," Hayley Berg, lead economist at the travel app Hopper, told Marketplace, referring to the summer of 2022. "This summer was a much more normal summer."

Rather than touching the prices of first-class fares, airlines have tended to reduce the costs of basic economy tickets, Mike Arnot, an analyst for the airline analytics company Cirium, told Marketplace. These tickets come with restrictions, and Arnot said airlines hope to make money back when customers pay for additional bags, specific seats, or other perks.

Unfortunately for Americans, the clock is likely ticking on lower prices.

Fuel costs, while lower than they were a year ago, could rise again over the next year, particularly if the Israel-Hamas war escalates further. Additionally, new agreements that pilots secured with airlines are expected to significantly raise labor costs — some of which could be passed on to consumers through higher prices.

"Times are good right now, but they're not going to last at that low end of the market," Arnot said. "Those cost pressures are going to hit the airlines."

Just between September and October, airline fares rose nearly 4%.