New Trend: One-Way Domestic Flights More Expensive Than Roundtrip

Airlines use all kinds of methods to price discriminate, to get each passenger to pay as much as possible for their ticket. That largely comes in the form of trying to determine who is a business traveler and who is a leisure traveler.

For example, there were recently headlines about how airlines increasingly have different pricing for solo travelers vs. groups, which is a fairly new practice. Well, here’s another new practice… or perhaps just the return of an old one.

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50%+ of domestic flights cheaper as roundtrip

For the past several years, the cost of two one-way tickets domestically within the United States has typically been the same as booking those flights roundtrip. There have of course been exceptions, but generally, airlines haven’t discriminated too much based on whether you’re booking as one-ways or as a roundtrip. International flights are a totally different story.

However, Thrifty Traveler reports that it seems that airlines are bringing back a practice that was popular decades ago, whereby one-way domestic fares are often significantly more expensive than roundtrip fares. Based on their sample of 2,000 flights across multiple airlines:

• Airlines charged more for two one-ways than one roundtrip on more than 50% of itineraries searched
• The closer to departure you book, the more common this practice is, with 90%+ of flights within 14 days having pricing disparity
• Delta uses this practice most often, followed by Alaska, followed by American, followed by United, followed by Southwest
• In some cases the difference is just a few bucks, while in other cases, the difference is $100+

Doing my own casual searches, I’m noticing the same thing, on a much more widespread basis than in the past. For example, if I search a one-way Tampa to Miami flight, I see fares starting at $287.

Meanwhile if I search that same flight as part of a roundtrip, the fare is as low as $174 (for basic economy), and it’s $234 for the same type of fare.

This is sort of annoying, likely won’t last long

The airline industry isn’t very high margin, and we’re always seeing airlines find new ways to try to maximize revenue. Airfare pricing isn’t transparent, but that’s not necessarily a bad thing — a vast majority of airline travelers are essentially paying fares below the average cost per air seat mile, so they’re being subsidized by some other party (those paying higher fares, credit card revenue, shareholders, etc.).

I think we’re currently at an interesting time when it comes to airline pricing, given how rapidly technology is advancing. For example, we know that Delta is increasingly using AI to price tickets, with the expectation that 20% of flights will be priced this way by the end of the year. The exact implications of that remain to be seen.

However, I’m not really bothered by any of these practices. Why? Well, the airline industry is extremely competitive, and airlines don’t have much pricing power at all. If they did, presumably they’d want their passenger revenue per air seat mile to be higher than their cost per air seat mile, when that’s often not even the case for profitable airlines.

Carriers can experiment all they want, but ultimately there’s competition. Sure, maybe airlines want to trial charging more for one-way tickets, but this also creates an opportunity for competitors to not offer that practice, and to steal market share.

If one-way tickets get so expensive that consumers aren’t willing to pay them, airlines will quickly find out, and reverse course. Obviously I don’t like this trend, but I also know that it won’t last for long, as consumers can vote with their wallets, and airlines will quickly get the hint.

I think airlines are currently a little overconfident in terms of the impact that their new pricing strategies will have. Let’s see how this all plays out…

Bottom line

It seems that a significant percentage of domestic flights within the United States have higher pricing if you book as two one-ways vs. as one roundtrip. This seems to be most prevalent as the departure date approaches, and Delta uses this practice the most.

This is definitely something to be aware of as you plan your travel. Airlines are ultimately limited in terms of their pricing power, so I’m curious to see how long this practice lasts on a widespread basis.

What do you make of airlines increasingly charging more for one-ways?