US airfares down 3.6% in second quarter 2013

The average domestic air fare decreased to $378 in the second quarter of 2013, down 3.6 percent from the average fare of $392 in the second quarter of 2012, measured in constant 2013 dollars, the U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) reported.

Huntsville, Ala., had the highest average fare, $547, while Atlantic City, N.J., had the lowest, $159.

BTS, a part of the Research and Innovative Technology Administration (RITA), reports average fares based on domestic itinerary fares. Itinerary fares consist of round-trip fares unless the customer does not purchase a return trip. In that case, the one-way fare is included. Fares are based on the total ticket value which consists of the price charged by the airlines plus any additional taxes and fees levied by an outside entity at the time of purchase. Fares include only the price paid at the time of the ticket purchase and do not include other fees, such as baggage fees, paid at the airport or on-board the aircraft. Averages do not include frequent-flyer or “zero fares” or abnormally high reported fares.

The second-quarter 2013 fare was down 18.4 percent in constant 2013 dollars from the average fare of $463 in 1999, which was the highest average fare of any second quarter, adjusted for inflation. The 18.4 percent decline took place while there was an increase in overall consumer prices of 40.5 percent. In the 18 years since BTS began collecting air fare records in 1995, inflation-adjusted fares declined 16.9 percent compared to a 53.1 percent increase in overall consumer prices.

U.S. passenger airlines collected 70.6 percent of their total revenue from passenger fares during the second quarter of 2013, down from 1990, the earliest year for which airlines’ revenues and expenses are available, when 87.6 percent of airline revenue was received from fares.