The no-frills “Basic Economy” airfares many travelers have come to hate (or maybe love, depending who you are) seem to be working in at least one way: The U.S. Department of Transportation’s Bureau of Transportation Statistics says that average airfares in the U.S. were $343.28 in the third quarter of 2018, which is a record low when adjusted for inflation.
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The average airfare of the same period in 2017 was just a bit higher, at $344. Over the years, inflation-adjusted fares were at peak high in the first quarter of 1999, when the average was $508.29. The overall trend since then has been downward, from the $450-$500 range in 1996-2002, the average has been sub-$400 since 2015.
Overall, that might sound like good news for travelers. But average fares don’t give the full picture.
The Bad News About Average Airfares
Although base-level fares have dropped, what travelers actually pay has not dropped as much because of extra fees. Those extras, for checked baggage, seat selection, and other add-ons, have risen from 12 percent of revenue in the late 1990s to 26 percent today. When you add the net fee increase of 14 percent, the current average fare figure increases drastically, to $392. The average fare level is also normally affected by average flight length, but the DOT data does not reflect this.
The good news is that even after the increase in fees, adjusted average airfares remain less than they were 20 years ago. The offsetting news is that the “main cabin” product is worse than it was 20 years ago, with tighter legroom and seat width. Still, that’s apparently what the market wants—or at the very least, will buy.
More from SmarterTravel:
- 12 New Airline Routes for Cheap Flights in 2019
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- 7 Airfare Analysts Weigh in on When to Book a Flight
Consumer advocate Ed Perkins has been writing about travel for more than three decades. The founding editor of the Consumer Reports Travel Letter, he continues to inform travelers and fight consumer abuses every day at SmarterTravel.