Airlines' Domestic Growth Plans Will Keep Fares Low (And Passengers Crammed) In 2018
Posted On: Apr 05, 2018
good news and bad news for domestic air travelers
There’s good news and bad news for domestic air travelers in the United States this year. And it’s the same news:
U.S. carriers – including the big, conventional network airlines; primary disruptor Southwest Airlines; and so-called ultra-low-cost carriers like Spirit, Frontier and others – are all planning to add lots of seats to their domestic networks in 2018.
That’s good news in that rising capacity historically puts a lid on fare prices.
It's bad news in that most of those additional seats will be just as tiny and just as uncomfortable as the ones already being flown around America’s skies. That’s the grand bargain that price-conscious travelers are increasingly being asked to make, though. You want affordable, even inexpensive fares for trips within the confines of the 48 contiguous states? Then you’re gonna pay, partially at least, with discomfort and joint pain.
Individuals, of course, will determine for themselves whether such a trade-off is a good deal. But for those whose bottom-line interest is, well, the bottom line, increased capacity, even when it means very tight confines, is a really good deal.
We know this via an industry statistic called “yield.”
Typically it’s defined as the average price paid per passenger per mile flown (total passenger revenue divided by total number of passenger miles flown). The result is the “average price paid” per mile flown, or yield. Final industry-wide numbers for 2017 haven’t been published yet, but American’s 2017 average yield was 14.52 cents, up 3.5% from 2016; United’s was 13.06 cents, up 0.6%; Delta’s was up 15.99 cents, up 0.9%; Southwest’s was 14.83 cents, down 0.5%; and Spirit’s was 10.55 cents, down 2.2%.