Airfare in early 2023 averaging higher than prior-year levels, expert says
Summer airline prices, though, will ease from the highs seen in 2022
Inteletravel co-founder and president James Ferrara discusses how work-from-home is impacting travel sales during the holiday season on 'The Claman Countdown.'
Airfare for domestic trips in the first few months of the new year are already averaging above 2022 levels as demand and costs remain high for major U.S. carriers, according to new data.
Trips in January 2023 will cost travelers $208, on average, per round-trip ticket, up 7% from prices the same time a year ago, according to data from travel app Hopper. Prices for trips between February and April are up even more, increasing 13% compared with a year ago.
Passengers wait for their luggage after arriving United Airlines flights at O'Hare International Airport on December 13, 2022 in Chicago, Illinois. (Scott Olson/Getty Images / Getty Images)
Hopper economist Hayley Berg told FOX Business that higher costs for labor, goods and jet fuel are impacting the "overall cost to an airline… and will be passed on, to some degree, to consumers."
THE BLEISURE TRAVELER—COMING TO THE RESCUE OF AIRLINES EVERYWHERE
On jet fuel prices, Berg said, "the reality is they're the highest that they've been since 2014." She estimated that 15% to 30% of the price consumers pay when buying a ticket is from fuel alone.
"When you see that significant increases in jet fuel, it just has to be passed onto the consumer in some way," she added.
Travelers stand in line for a TSA checkpoint at the Miami International Airport on December 19, 2022 in Miami, Florida. (Joe Raedle/Getty Images / Getty Images)
She said that airfare will remain high until there is a significant and sustained improvement in jet fuel prices.
DELTA LIFTS ITS 2023 GUIDANCE AS TRAVEL STOCK TAKES OFF
Prices at the start of 2022 were lower than what they normally would have been due to surges in COVID-19 cases. Berg added that this is part of the reason there are increases over last year.
Summer airline prices, though, will ease from the highs seen in 2022.
In the summer of 2022, consumers saw a massive run-up in demand and jet fuel prices. There also wasn't enough supply. As a result, airfare was pushed up "tremendously," according to Berg.
Travelers arrive for flights at O'Hare International Airport on December 16, 2022 in Chicago, Illinois. (Scott Olson/Getty Images / Getty Images)
"We were seeing thousand-dollar flights for just domestic trips," Berg said.
For summer 2023, Berg is not expecting massive supply constraints. On top of that, jet fuel is "looking better." Even though demand is going to remain strong, it will be more in line with typical seasonal patterns, she added.
Berg is therefore expecting summer prices to be better for the consumer compared with a year ago.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Travelers arrive for flights at O'Hare International Airport on December 16, 2022 in Chicago, Illinois. (Scott Olson/Getty Images / Getty Images)
The best piece of advice for flying in 2023, according to Berg, is to fly at the right time and be flexible on trip dates.
For instance, travelers can save significantly if they book a trip in January rather than waiting for spring break.