Big picture, the cost of airfare has remained reasonable over the decades, as flying has been democratized thanks to the competitive landscape. However, admittedly there are some fluctuations, and we’re seeing one of those right now. There has been a lot of talk about how expensive airline tickets are getting, and we now have data!
In this post:
Statistics on how the cost of airline tickets is increasing
The United States Bureau of Labor Statistics has just published its latest consumer price index summary, showing how the cost of various goods has changed over the past year. The single biggest year-over-year increase we’re seeing is for airfare, which is up 20.7% compared to 12 months ago.
It goes without saying that this is a massive increase. Just to look at the numbers, the value for April 2025 was 255.59, while the value for April 2026 was 308.53 (these aren’t dollars, but instead, index values relative to 1982-1984, where the period is set to an index of 100).
If you prefer to see this in a graph, below you can see the fluctuations over the past 10 years.
As you can see, we’ve particularly seen an increase in airfare in the first four months of 2026:
- Between April and December 2025, airfare actually decreased, from a value of 255.59 to a value of 253.74
- In the first four months of 2026 alone, airfare increased from a value of 253.74 to a value of 308.57
- The situation is actually worse than the 20.7% increase over 12 months, as airfare has actually increased 21.6% over the past four months
Here’s how the methodology for determining this data is described:
Eligible for pricing are all regularly scheduled domestic and international commercial airline trips on certified carriers departing from each city in the CPI sample. For the selected cities that do not have a qualifying airport, the nearest city with a qualifying airport is designated as the city of departure.
Prices include all applicable taxes for both domestic and international travel. Fuel surcharges, airport, security, and baggage fees are also included. Eighty percent of quotes in the CPI sample are designated to include a checked bag on the flight. Whether a given quote is assigned a bag is randomly determined at quote initiation. The CPI only tracks the price of the first piece of checked luggage. The price of carry-on bags and any additional checked luggage are not tracked.
What can we make of these rapid airfare increases?
It goes without saying that the conflict with Iran has caused jet fuel prices to skyrocket. While the cost of airline tickets isn’t typically correlated that closely to the cost of actually transporting people (given the elasticity of demand), airlines have done an impressive job (from their perspective) raising fares to offset those increases. That’s particularly true of the legacy carriers.
But what I find interesting here is that the cost of airfare already started to increase drastically before that. Admittedly there’s some seasonal element to this, but still, these increases are material.
Everyone talks about the K-shaped economy, and that’s true in the airline industry more than anywhere. Premium demand seems to be insatiable, while airlines are having a harder time filling economy seats. Of course Spirit’s recent liquidation also won’t help with keeping airfare affordable, though those ticket costs were subsidized by shareholders and investors for far too long, so it just wasn’t sustainable.
United management has been very clear that they plan to keep around higher fares as much as possible even when oil prices decrease. As United CEO Scott Kirby recently admitted on an earnings call:
“Certainly, the longer this lasts, the higher the probability goes that the pricing increases hold. And we probably won’t hold 100% if we normalize as I told the team earlier today, and it’s just my guess that if things went back to mid-February normal, I think we get to keep 20% of the price increase next year. I think that’s going to move towards 80%. And every day, it’s ticking up longer as this goes on.”
But we also have Transportation Secretary Sean Duffy gaslighting consumers, claiming that high jet fuel prices will make tickets cheaper in the long run. Oh, and he says that all while United (which is promising investors to keep fares higher) is sponsoring his patriotic road trip.
Bottom line
The cost of airfare in the United States has increased 21.6% in the past four months. Obviously high oil prices partly fit into that, but the trend already started before the conflict with Iran. The airline business is tough, and it’s understandable that airlines have to recoup some of the increased oil prices. However, airlines insist they plan to keep around these higher fares even when oil prices drop.
Usually I think people are a little dramatic about how expensive airfare is, because adjusted for inflation, it’s quite reasonable, big picture. Still, the increases at the moment are drastic, and there’s reason to be concerned. That’s especially true when you consider that only a small number of airlines are doing well, while others are on the verge of bankruptcy.
What do you make of this data about the increase in airfare costs?
This data is poor because it does not take into account inflation or what you get for that money (e.g. soft and hard services). Furthermore, we don't see prices going down. If it is really the cost of oil then they should get the airlines to lower their price when oil prices reduce but the truth is airlines charge what they think they can charge depending on many factors.
Fuel Fuel Fuel greatest administration ever said NO ONE EVER
This is terrible tracking.
Inflation is way higher than this: they don't include the fact that the legroom you got 20 years ago is at an extra cost and the meal you used to get is not only no longer a hot meal, but a cold stale sandwich you have to pay for.
They do hedonistic adjustments for things like TVs and cars, why not for air travel? Terrible, absolutely terrible.
Good - I hope it keeps going up to the lower income people can't afford to fly. Frankly, we need a better class of customers. Even on the legacy carriers, let alone on the ULCCs, there are too many once a year fliers and people that clearly have no clue what they are doing.
Also Ben you talked about airfare being "affordable". That word has no meaning. Everything is affordable, it just depends on who...
Good - I hope it keeps going up to the lower income people can't afford to fly. Frankly, we need a better class of customers. Even on the legacy carriers, let alone on the ULCCs, there are too many once a year fliers and people that clearly have no clue what they are doing.
Also Ben you talked about airfare being "affordable". That word has no meaning. Everything is affordable, it just depends on who can afford it. There should be no obligation on business to price products just so low-mid income people can afford them.
Bad idea. We should want healthy competition, as consumers, as anyone involved with the industry, as citizens, etc. We should not want to hope that airfares get so expensive that entire market segments just stay home. The wealthy should not be the only ones entitled to travel. The overall economy depends on the relatively easy movement of people and goods.
Agreed. Apart from the obnoxiously self centered classism of the retired gambler, this is just common sense. No matter how much the “elite” resent the “common folk,” they need them to power the economy so they (the elite) can remain elite. Betting he complains about the rain too, despite the fact that without it, he’d fuckin starve and have nothing but poker chips to eat.
100% correct. It's expensive to run planes and do it the right way. Sorry, a $39 fare does nothing but erode the industry.
When I was growing up in the 1970s we were one of the very few families (in fact maybe the only that I remember) that could afford to fly 2-3 times a year. My parents had a second (a small) home in Florida. No one said it wasn't fair and "racist" that...
100% correct. It's expensive to run planes and do it the right way. Sorry, a $39 fare does nothing but erode the industry.
When I was growing up in the 1970s we were one of the very few families (in fact maybe the only that I remember) that could afford to fly 2-3 times a year. My parents had a second (a small) home in Florida. No one said it wasn't fair and "racist" that the Romey family could afford to fly to Florida and they could not. Most people hooked up a trailer to their station wagon and went camping.
I remember those days. Someone melting down at the airport and acting like a wild animal would have been beyond unthinkable.
90% of domestic coach fares are money losers for airlines so it was only a matter of time before fares went up even if oil prices did not jump. On most travel sites people seem to think success in the airline industry would be to cut fares in half, give everybody big raises and provide the best in customer service. There's a reason those individuals would never last in this business.
I mean we can do all of those but the big raises by just explaining the aviation labor supply. Piloting Boeing and airbus aircraft is possible the most fungible job skill in the world and FA jobs are pretty standardized. Seems like thats where all the h-1b visas should go.
People aren't going to stop flying just as they won't stop putting gas in their tank or checking bags when flying.
As Ben noted in the piece, demand for air travel is elastic. As prices go up, demand goes down; this applies to both leisure travelers and, to a lesser extent, business travelers, but it does apply to both. The strange thing we seem to be observing this go round is that the demand for premium travel still seems stable.
Driving is a different bird entirely, because irrespective of fuel prices, people still need to go...
As Ben noted in the piece, demand for air travel is elastic. As prices go up, demand goes down; this applies to both leisure travelers and, to a lesser extent, business travelers, but it does apply to both. The strange thing we seem to be observing this go round is that the demand for premium travel still seems stable.
Driving is a different bird entirely, because irrespective of fuel prices, people still need to go to work, buy groceries, and generally get on with lives no matter what the price of gas at the pump is.
It's called a K-shaped economy.
Also consider the premium vs coach mix. There's far fewer premium seats to fill in the first place, the supply of premium travelers doesn't need to be that big.
Leisure travel is elastic in the long-term, whereas business travel is considered inelastic. If the pandemic taught us anything, it's that Zoom & Teams calls are no substitute for face-to-face meetings.
People aren't going to stop flying just as they won't stop putting gas in their tank or checking bags when flying.
Some will stay home. Not everyone is well-off enough to ‘not care’ about inflation, whether in airfare, or gas for their cars, or food, or healthcare, or housing, or…
Winning!
Flying needs to increase in cost more. The smallest fare for LAX-SFO and ORD-LGA should be $1000. All air travel should be placed beyond the affordability of the trailer trash that used to fly Spirit. And re-regulate it while we're at it.
You're just going to make your mom take Amtrak?
No, trailer trash, because she's dead.
Not to be political at all here, but under Biden we saw a huge increase from May to May according to the graph. Why did it even shoot up so much during that time?
Revenge travel.
Post covid...people wanted to get away
If you’re talking 2021-2022, the fat orange Nazi’s BFF (and lapdog) Pootie invaded Ukraine in Feb ‘22.
You must be a cheerful person.
Wow, were.younpaying attention?
Remember how that administration gave the airline billions of dollars to keep employees and yet they fired everyone? And when people started flying again they couldn't run a full schedule for almost 2 years?
Demand outstripping a reduced demand will do that.
It’ll be interesting to see whether the lack of demand for World Cup travel into the U.S., as reflected by (among other things) sluggish hotel bookings, translates into flatter fares. I assume airlines had built some World Cup demand into their forecasting for summer 2026.
Prices for tickets and transportation to the stadiums (in NYC-area at least) are outrageous… what should be a $15 train ride or bus fare is $100+… the tickets are $600-1,000 per person starting nosebleed not-assigned. That’s cutting a lot of actual fans out. Sad. It shouldn’t be just for the super-rich.
These events are always awful for airline profitability: business people are crowded out, and with it the profits they bring.
Air France lost almost $200m in earnings for the Olympics in Paris, British Airways did the same for the Olympics in London, etc.
Google "Air France Paris Olympics loss"
On the other hand, compared to *ten* years ago (i.e. May 2016), it's more or less flat. Which I think reinforces the point that tickets are priced based on what carriers can get away with, not based on how much it costs to operate the flight.
It's always been like that.
Hence people still throw away their last segment.
I find these charts to be consistently misleading as they don't account for things that airfare used to include (for example, bags, seat assignment or even the same number of loyalty miles/points). The chart may show the trend of pure airfare over time, but it's not accurately reflecting the cost of air travel for the average passenger overtime. The airlines all raised the cost of bags in the last few months, and this is not...
I find these charts to be consistently misleading as they don't account for things that airfare used to include (for example, bags, seat assignment or even the same number of loyalty miles/points). The chart may show the trend of pure airfare over time, but it's not accurately reflecting the cost of air travel for the average passenger overtime. The airlines all raised the cost of bags in the last few months, and this is not even shown on the chart. This is not dissimilar to when nightly cost of hotels are tracked over time, without including junk fees like "resort fees".
I apologize. My reading comprehension could use some work. Turns out bag fees are included. I stand somewhat corrected; I think seat assignment and other junk fees are still not being accurately reflected.
Worst Administration ever.
The Wurst Administration was actually under Obama when we had Democrat Representative Anthony Weiner letting it all hang out.
Unlike the kiddie fiddler in there now?
And that incident with Weiner raised prices how?
Post-pandemic inflation has been a worldwide problem that's beyond the control of mere politicians.
TIL Anthony Weiner was part of the Obama administration.