The “airline recession” is translating to lower airfares for consumers
The list of things that are cheaper than they were 15 years ago is pretty short — plane tickets are on it.
Airlines are having a turbulent time of it at the minute, with the CEO of Southwest Airlines declaring that the industry is in a recession last week and a host of major US carriers deciding to scrap their outlooks for the year ahead.
One beneficiary of the industry’s wider struggles? Cost-conscious globetrotters on the lookout for cheap flights, as fares continue to plummet. In March, airline fares slipped 5.3% year on year, helping to cement it as one of the few categories tracked by the Bureau of Labor Statistics to have actually dropped in price over the last 15 years.
Indeed, the airfare category within the CPI is now 4% lower than it was 15 years ago, per the Bureau of Labor Statistics.
That’s a pretty stark finding considering that the wider basket of goods that makes up the headline Consumer Price Index figure, or CPI — pretty much what almost every commentator is referencing when they talk about US inflation — has risen 47.6% since 2010.
Though it’s worth noting that the Bureau’s inflation figures don’t always mean prices are falling in real terms — TVs, for example, get all sorts of quality adjustments (screen size being one) which affect the CPI figures — the BLS doesn’t make any adjustments to airline fares. So, the cost of your economy seat really is cheaper than it was 15 years ago.
The tight competition between major competitors in the air space, which recently saw American Airlines buckle to meet demands for free Wi-Fi (long the norm at other carriers), has helped to keep prices from soaring in the modern era of aviation.
