WASHINGTON - The average United States domestic air fare increased to $396 in the second quarter of 2014, up 2.5 percent from the average fare of $386 in the second quarter of 2013, adjusted for inflation, the U.S. Department of Transportation's (DoT) Bureau of Transportation Statistics (BTS) reported. During that April to June period, passengers originating in Cincinnati, Ohio, paid the highest average fare, $523, while passengers originating in Sanford, Florida, paid the lowest, $111.

BTS 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. One-way trips accounted for 33 percent of fares calculated for the second quarter of 2014. 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 either the airport or onboard the aircraft. Averages do not include frequent-flyer or zero fares, or abnormally high reported fares. Constant 2014 dollars are used for inflation adjustment.

Second-quarter fares rose 17.0 percent adjusted for inflation from the recession-affected low of $334 in 2009 to the second quarter of 2011. Since 2011, second quarter fares have shown little change, increasing 1.4 percent from 2011 to 2014.

The second-quarter 2014 fare was down 16.2 percent adjusted for inflation from the average fare of $472 in 1999, the highest inflation-adjusted second quarter average fare in the 19 years since BTS began collecting air fare records in 1995. The 16.2 percent decline took place while overall consumer prices rose 43.4 percent. Since 1995, inflation-adjusted fares declined 14.7 percent compared to a 56.3 percent increase in overall consumer.

U.S. passenger airlines collected 71.4 percent of their total revenue from passenger fares during the second quarter of 2014, down from 1990 when 87.6 percent of airline revenue was received from fares.

In the three-year period from the second quarter of 2011 to the second quarter of 2014, inflation-adjusted fares increased 0.3 percent. In the two-year period from the second quarter of 2012 to the second quarter of 2014, inflation-adjusted fares decreased 1.0 percent.

Not adjusting for inflation, the $396 second-quarter 2014 average fare was the highest average fare for any quarter since 1995. The previous highest unadjusted quarterly fare was $390 in the third quarter of 2013 and the previous highest unadjusted second-quarter fare was $385 in 2012. Since 1995, unadjusted fares rose 33.3 percent compared to a 56.3 percent increase in overall consumer prices.

Unadjusted second-quarter 2014 fares were up 3.6 percent from the first quarter of 2014.

Source: U.S. DoT/BTS
Associated URL: http://www.rita.dot.gov/bts/press_releases/bts050_14
Author: U.S. DoT/BTS