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BTS 36-08
Contact: Dave Smallen, Tel.: (202) 366-5568
Wednesday, July 23, 2008
BTS
Releases First-Quarter 2008 Air Fare Data;
Average First-Quarter
Domestic Air Fares Rose 4.4 Percent from 2007;
Top 100 Airports: Highest Fare in Cincinnati, Lowest Fare at Atlantic City
Average domestic air fares in the first quarter of 2008 were up 4.4 percent from the first quarter of 2007 (Table 1) in the largest year-to-year increase since second quarter 2006, but average fares remained 4.6 percent below the January-to-March high set in 2001 (Table 6), the U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) reported today.
BTS, a part of the Research and Innovative Technology Administration, reported that average fares increased 11.7 percent from the first quarter of 1995 to the first quarter of 2008 compared to a cumulative 41.0 percent inflation rate. First quarter 2008 fares increased 4.4 percent from the first quarter of 2007 compared to a 4.0 percent inflation rate (Table 1).
The average domestic itinerary fare in the first quarter of 2008 of $332 was the highest average fare since the second quarter of 2006 (Table 2). The first-quarter 2008 average fare was up 10.1 percent from the post-9/11 first-quarter low of $301 in 2005 (Table 6).
Average fares are based on domestic itinerary fares, round-trip or one-way for which no return is purchased. Fares include taxes and fees. Averages do not include frequent-flyer or “zero fares” or a few abnormally high reported fares. Average fares in this release may not be comparable to BTS fare press releases before the second quarter of 2007 which did not exclude frequent flyer fares or abnormally high fares. Bulk fares continue to be excluded as in earlier releases.
Average air fares in the first quarter of 2008 rose 1.5 percent from the fourth-quarter 2007 average of $327 (Table 2). Quarter-to-quarter changes may be affected by seasonal factors.
Beginning with this release, BTS will not include Alaska, Hawaii and Puerto Rico airports in average fare totals and rankings. Average fares for those airports are available on the BTS Air Fare web page. http://www.bts.gov/xml/atpi/src/index.xml.
Of the top 100 airports based on originating passengers, the highest first-quarter average fares were in Cincinnati; followed by Greenville/Spartanburg, SC; Madison, WI; Knoxville, TN; and Grand Rapids, MI. The lowest fares in the top 100 airports were at Atlantic City, NJ followed by Dallas Love, TX; Burbank, CA; Ft. Lauderdale, FL; and Las Vegas (Table 3). See the BTS Air Fare web page for average fares for the top 100 airports.
The largest year-to-year average fare increase for the first quarter among the 100 largest airports, ranked by originating passengers, was 15.6 percent in Boston followed by Washington Dulles; Houston Bush; Washington Reagan National; and Chicago Midway (Table 4).
The biggest year-to-year average decrease was 48.6 percent Atlantic City, NJ followed by Charleston, SC; Ft. Lauderdale, FL; San Francisco; and Atlanta (Table 4).
The largest average fare increase from the first quarter of 1995 was 187.2 percent at Dallas Love, followed by Lubbock, TX; Houston Hobby; El Paso, TX; and Las Vegas (Table 5).
The largest average fare decrease from the first quarter of 1995 to the first quarter of 2007 was 34.6 percent in White Plains, NY. The other top five average fare decreases over this period took place at Manchester, NH; Newburgh, NY; Jackson, MS; and Pittsburgh (Table 5).
The Air Travel Price Index (ATPI)
A separate measure of fares, the BTS Air Travel Price Index (ATPI) was up 6.0 percent from the first quarter of 2007 to the first quarter of 2008, reaching the highest first-quarter level recorded in the 14 years of the ATPI (Table 8) (1995 1st quarter = 100). The ATPI is up 3.8 percent from its pre-9/11 first quarter high set in 2001 and up 16.8 percent from its post-9/11 first quarter low set in 2005 (Table 7).
ATPI is a statistical index that documents quarterly changes in airline prices since the first quarter of 1995. The index measures changes in airline ticket prices used on identical routings and identical classes of service on a quarter-by-quarter basis. The index can be used to compare airfares in the most recent available quarter to any quarter since the base year of 1995.
While the ATPI measures changes in fares, average fares measure the actual amount paid by passengers, including taxes and fees. Average fares take account of both the level of fares and the number of passengers purchasing fares at different levels. Average fares do not necessarily account for the level of service, as ATPI does.
Average fare calculations and the ATPI, while similar, measure air fares in two different ways and may produce different results. ATPI measures the rise in airfares and average fares show the increased use of lower fares. The varying results reflect trends in the airline industry that have resulted in more passengers using lower air fares even though fare levels continue to rise. Three of these trends follow.
First, low-cost carriers, which generally offer lower fares, now carry about 40 percent of all domestic enplaned passengers, up from about 14 percent in 1995. Second, the network carriers have been forced to match some of the low-cost carrier relaxed fare rules, such as eliminating the “Saturday Night Stay Rule”, which has allowed more passengers to purchase lower fares. Third, use of the internet allows almost instant price comparisons that give the customer the opportunity for unprecedented low-fare shopping.
The ATPI rose 2.3 percent from the fourth quarter of 2007 to the first quarter of 2008. Quarter-to-quarter changes may be affected by seasonal factors (Table 2).
The largest year-to-year fare index increase for the first quarter among the 85 largest airline markets, ranked by passengers, was 13.3 percent in Buffalo/Niagara, NY followed by Charlotte, NC; Boston; Washington; and Philadelphia (Table 9).
The biggest year-to-year ATPI decrease for the first quarter was 6.1 percent for trips originating in Charleston, SC; St. Louis; Memphis, TN; Atlanta; and Seattle/Tacoma (Table 9).
The largest fare index increase from the first quarter of 1995 to the first quarter of 2008 was 68.8 percent in Burbank, CA. The other top ATPI increases over this period took place at Long Beach, CA; Ft. Myers, FL; New Orleans; and Greensboro/High Point, NC (Table 10).
There were no first-quarter fare index decreases for the 13-year 1995-to-2008 period. The smallest increases were in Manchester, NH; Denver; Richmond, VA; Raleigh/Durham, NC; and Detroit (Table 10).
Alaska, Hawaii and Puerto Rico airports have been excluded from Tables 9 and 10 of this release. Those airports are included in the total ATPI and data about them can be found on the ATPI rankings on the BTS Air Fare web page.
Additional information about average fares, including fares for the top 100 airports based on U.S. originating domestic passengers, can be found on the BTS website at http://www.bts.gov/xml/atpi/src/index.xml. Additional information can also be found on that page about the ATPI, including indexes for foreign-origin itineraries and the top 85 air travel markets based on originating passengers. Second-quarter 2008 average fare data and the ATPI will be released on Oct. 29.
The ATPI series are computed using a price index methodology. Although the ATPI is computed using a tested index methodology, it is considered a research series at this time.
Table 1: First Quarter Average Fares 1995-2008 Compared to Inflation Rate
Fares based on domestic itinerary fares, round-trip or a one-way for which no return is purchased.
Averages do not include frequent flyer fares.
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Average Domestic 1Q Fares ($) |
Percent change from previous year |
Percent change from 1995 |
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Average Fares (1Q to 1Q) |
Inflation (March from previous March)* |
Cumulative Average Fares (1Q 1995 to 1Q) |
Cumulative inflation rate (March of each year from March 1995)* |
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1995 |
297 |
|
|
|
|
|
1996 |
284 |
-4.4 |
2.8 |
-4.4 |
2.8 |
|
1997 |
283 |
-0.2 |
2.8 |
-4.6 |
5.7 |
|
1998 |
305 |
7.5 |
1.4 |
2.6 |
7.1 |
|
1999 |
332 |
8.9 |
1.7 |
11.7 |
9.0 |
|
2000 |
340 |
2.6 |
3.8 |
14.6 |
13.1 |
|
2001 |
348 |
2.2 |
2.9 |
17.1 |
16.4 |
|
2002 |
320 |
-8.0 |
1.5 |
7.8 |
18.1 |
|
2003 |
319 |
-0.3 |
3.0 |
7.5 |
21.7 |
|
2004 |
320 |
0.3 |
1.7 |
7.8 |
23.8 |
|
2005 |
301 |
-5.9 |
3.2 |
1.5 |
27.7 |
|
2006 |
323 |
7.3 |
3.4 |
8.9 |
32.0 |
|
2007 |
318 |
-1.7 |
2.8 |
7.0 |
35.6 |
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2008 |
332 |
4.4 |
4.0 |
11.7 |
41.0 |
Source: Bureau of Transportation Statistics
Note: Percent change based on unrounded numbers
* Rate calculated using Bureau of Labor Statistics Consumer Price Index
Table 2: Average Domestic Airline Fares and Air Travel Price Index Since Second Quarter 2006 (Percent Change by Quarter)
Fares based on domestic itinerary fares, round-trip or one-way for which no return is purchased.
ATPI 1Q 1995=100
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Average Domestic Fares |
Air Travel Price Index |
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Avg Fare* ($) |
Pct. Change |
Index |
Pct. Change |
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Second Quarter 2006 |
342 |
5.3 |
120.6 |
5.3 |
|
Third Quarter 2006 |
330 |
-3.5 |
117.4 |
-2.6 |
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Fourth Quarter 2006 |
318 |
-3.8 |
114.0 |
-2.9 |
|
First Quarter 2007 |
318 |
-0.1 |
114.6 |
0.5 |
|
Second Quarter 2007 |
325 |
2.3 |
117.8 |
2.9 |
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Third Quarter 2007 |
328 |
0.7 |
118.8 |
0.8 |
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Fourth Quarter 2007 |
327 |
-0.3 |
118.7 |
-0.1 |
|
First Quarter 2008 |
332 |
1.5 |
121.4 |
2.3 |
Source: Bureau of Transportation Statistics
* Average fare numbers were revised from second-quarter 2007 press release issued on Oct. 24, 2007
Note: Quarter-to-quarter changes may be affected by seasonal factors.
Note: Percent change based on unrounded numbers
Table 3: Highest and Lowest Average Domestic Fares First Quarter 2008
Top 100 Airports* Based on 2007 U.S. Originating Domestic Passengers
Fares based on domestic itinerary fares, round-trip or one-way for which no return is purchased.
Averages do not include frequent flyer fares.
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Rank |
Origin |
First Quarter 2008 |
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Highest Average Fares |
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1 |
Cincinnati, OH |
535 |
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2 |
Greenville/Spartanburg, SC |
474 |
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3 |
Madison, WI |
455 |
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4 |
Knoxville TN |
440 |
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5 |
Grand Rapids, MI |
436 |
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Average Fare at All Airports |
332 |
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Lowest Average Fares |
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1 |
Atlantic City, NJ |
109 |
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2 |
Dallas Love, TX |
210 |
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3 |
Burbank/Glendale/Pasadena, CA |
237 |
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4 |
Ft. Lauderdale, FL |
238 |
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5 |
Las Vegas, NV |
241 |
Source: Bureau of Transportation Statistics
* Not including Alaska, Hawaii or Puerto Rico
Table 4: Top Five Average Domestic Fare Increases and Decreases, 2007-2008
Top 100 Airports* Based on 2007 U.S. Originating Domestic Passengers
Fares based on domestic itinerary fares, round-trip or one-way for which no return is purchased.
Averages do not include frequent flyer fares.
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Rank |
Origin |
First Quarter 2007 |
First Quarter 2008 |
Percent Change from 1st Qtr 2007 |
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Largest Increases |
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1 |
Boston, MA |
335 |
388 |
15.6 |
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2 |
Washington Dulles, VA |
363 |
418 |
15.2 |
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3 |
Houston Bush, TX |
354 |
405 |
14.5 |
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4 |
Washington Reagan National |
349 |
397 |
13.7 |
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5 |
Chicago Midway, Il |
223 |
253 |
13.3 |
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Average Fare at All Airports |
318 |
332 |
4.4 |
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Largest Decreases |
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1 |
Atlantic City, NJ |
212 |
109 |
-48.6 |
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2 |
Charleston, SC |
493 |
401 |
-18.8 |
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3 |
Ft. Lauderdale, FL |
258 |
238 |
-7.7 |
|
4 |
San Francisco, CA |
422 |
396 |
-6.2 |
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5 |
Atlanta, GA |
377 |
354 |
-6.0 |
Source: Bureau of Transportation Statistics
Note: Percent change based on unrounded numbers
* Not including Alaska, Hawaii or Puerto Rico
Table 5: Top Five Average Domestic Fare Increases and Decreases, 1995-2008
Top 100 Airports* Based on 2007 U.S. Originating Domestic Passengers
Fares based on domestic itinerary fares, round-trip or one-way for which no return is purchased.
Averages do not include frequent flyer fares.
|
Rank |
Origin |
First Quarter 1995 |
First Quarter 2008 |
Percent Change from 1st Qtr 1995 |
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Largest Increases |
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|
1 |
Dallas Love, TX |
73 |
210 |
187.2 |
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2 |
Lubbock, TX |
126 |
268 |
112.8 |
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3 |
Houston Hobby, TX |
124 |
249 |
100.9 |
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4 |
El Paso, TX |
154 |
301 |
95.7 |
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5 |
Las Vegas, NV |
134 |
241 |
79.7 |
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Average Fare at All Airports |
297 |
332 |
11.7 |
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Largest Decreases |
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1 |
White Plains, NY |
463 |
303 |
-34.6 |
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2 |
Manchester, NH |
433 |
303 |
-30.1 |