Airfares rose nearly 43% over the same period a year ago, according to data released by the Labor Department on Thursday, a record-setting increase that topped the department’s monthly Consumer Price Index (CPI) report.
The CPI, which measures inflation, found that prices overall across all categories rose 8.2% over the past year, and 0.4% in the past month. Last month’s report found airfare up 33%.
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Airfare was the fastest-growing category, followed by gas utility bills (33.1%) and eggs (30.5%). Gasoline was fourth, up 18.2%.
The surge in airfare comes as demand has remained strong into the fall “shoulder season” between the busy summer and holiday travel periods, an unusual trend. Pent-up leisure travel demand from nearly two years of closed borders has remained robust, while business travel is slowly beginning to return as more workers go back to offices.
During a call with investors on Thursday, Delta Air Lines president Glenn Hauenstein noted that travel demand to Europe, in particular, has been unusually strong.
“Demand for trans-Atlantic travel is extending well into the fall,” Hauenstein said. “Starting in October, we anticipate flying more trans-Atlantic capacity than 2019.”
That strong demand is expected to continue into the holidays, Hauenstein said.
Complicating the surge in airfare pricing is the airlines’ reactions to various operational disruptions this spring and summer, when carriers reduced capacity to build more slack into their networks.
Related: 5 key tools and tips to find the cheapest airfare
While this had the positive effect of giving airlines more flexibility to respond to delays and cancellations caused by things such as thunderstorms, it also meant that the airlines were effectively pulling supply from the system. With demand remaining high and supply falling, prices inherently increase.
Airfares are expected to remain high through at least the holidays. Christmas flight prices are up 55% over last year and 19% over 2019, according to data tracked by flight booking service Hopper, while Thanksgiving prices are up 25% from last year.
There are signs, however, that inflation is beginning to affect Americans’ holiday plans. A recent survey by Bankrate found that of the 43% of American adults who plan to travel during the holidays, 79% are changing aspects of their travel plans due to inflation (Bankrate is owned by Red Ventures, which also owns TPG.)
If you haven’t booked holiday travel yet, consider making your plans on the sooner side: holiday flight prices typically increase as October moves into November, meaning its likely prices will go up.
Be sure to check out TPG’s guide to find the cheapest airfare, and subscribe to our daily newsletter to stay up to date on the latest.
Featured image by glegorly/Getty Images/iStock
