Average Air Fares Reach Highest Fourth-Quarter
Level Since 2000; Top 100 Airports: Highest Fare in Anchorage,
Lowest Fare at Dallas Love
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BTS 19-07
Dave Smallen
202-366-5568 |
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Wednesday, April 25,
2007 - Average air fares in the fourth quarter of 2006 reached the highest fourth-quarter
level since 2000, rising 3.4 percent from the fourth quarter of 2005 (Table 1), the U.S. Department of
Transportation's Bureau of Transportation Statistics (BTS) reported today.
BTS, a part of the Research and
Innovative Technology Administration, reported that the
average domestic itinerary fare in the fourth quarter of 2006 was $378, up 3.4
percent from the average fare in the fourth quarter of 2005 but down 6.8
percent from the historic fourth-quarter high of $407 in 2000 (Table 1).
Average
fares are based on domestic itinerary fares, round-trip or one-way for which no
return is purchased. Averages include frequent-flyer fares.
Average air fares in the fourth
quarter fell 3.0 percent from the third-quarter average of $391. The post-2001 high of $406 was set in the
second quarter of 2006 (Table 2). Quarter-to-quarter
changes may be affected by seasonal factors.
Of the top 100 airports based on
passenger enplanements, the highest fourth-quarter average fares were in Anchorage,
AK, followed by Cincinnati,
Honolulu, San
Francisco and New York
John F. Kennedy
International Airport. The lowest fares in the top 100 airports were
at Dallas Love Field, followed by Chicago
Midway International
Airport, Houston
William P. Hobby
Airport, Islip,
NY and Buffalo,
NY (Table 3). See http://www.bts.gov/xml/atpi/src/index.xml for average fares for the top 100 airports.
A separate measure of fares, the BTS
Air Travel Price Index (ATPI) reached the highest fourth-quarter level recorded
in the 11-year period measured by the index, 2.2 percent higher than the
previous fourth quarter high in 2000 (Table 4) (1995 1st quarter =
100).
ATPI is a statistical index that
documents quarterly changes in airline prices since the first quarter of 1995 using
5 million to 6 million tickets actually used by passengers for itineraries on U.S. carriers beginning in the United States.
The index measures changes in airline ticket prices used on identical routings
and identical classes of service on a quarter-by-quarter basis. The index
can be used to compare airfares in the most recent available quarter to any
quarter since the base year of 1995.
While the ATPI measures changes in fares, average fares
measure the actual level of fares paid by passengers. Average fares take account of both the level
of fares and the number of passengers purchasing fares at different
levels. Average fares do not necessarily
account for the level of service, as ATPI does.
The
different results from the fourth quarter of 2000 to the fourth quarter of 2006
demonstrate that ATPI and average fares, while similar, measure air fares in
two different ways. ATPI measures the
rise in airfares and average fares show the increased use of lower fares. The varying
results reflect trends in the airline industry that have resulted in more
passengers using lower air fares even though fare levels continue to rise.
First,
low-cost carriers, which generally offer lower fares, now carry more than 27
percent of all domestic enplaned passengers, up from about 14 percent in
1995. Second, the network carriers have
changed some of their fare rules, such as the "Saturday Night Stay Rule", which
has allowed more passengers to purchase lower fares. Third, use of the internet allows almost
instant price comparisons that give the customer the opportunity for
unprecedented low-fare shopping.
The
ATPI for the fourth quarter of 2006 was 9.1 percent higher than the fourth
quarter 2005 index (Table 5).
While
reaching a fourth-quarter high, the ATPI declined for the second consecutive
quarter and was down 5.5 percent from the record high set in the second quarter
of 2006 (Table 6). Quarter-to-quarter changes may be affected by seasonal
factors.
The largest
year-to-year fare index increase for the fourth quarter among the 85 largest
airline markets, ranked by passengers, was 16.1 percent in Long Beach, CA
followed by Hartford, CT; Providence, RI; Charleston SC; Manchester, NH (Table 7).
The biggest year-to-year
fare index decrease for the fourth quarter was 21.5 percent for itineraries
originating in Lihue, HI. The top four fare decreases over this period took place at
Hawaiian airports. Charlotte, NC, was the non-Hawaiian market with a top fare
decrease (Table 7).
The largest fare index
increases from the fourth quarter of 1995 to the fourth quarter of 2006 was 173.7
percent in Long
Beach. The
other top five fare index increases over this period took place at Lihue;
Burbank/Glendale/Pasadena, CA; Kona, HI; and Phoenix (Table 8).
The only fourth-quarter
11-year fare index decreases were in Richmond, VA; Manchester; and Baltimore. The smallest increases were in Chicago and Denver (Table 8).
Additional
information about the ATPI, including indexes for foreign-origin itineraries
and the top 85 air travel markets based on originating passengers, can be found
on the BTS website, http://www.bts.gov/xml/atpi/src/index.xml. The first-quarter 2007 ATPI and
average fare data will be released on July 25.
The ATPI series are computed using a price index
methodology. Although the ATPI is computed using a tested index
methodology, it is considered a research series at this time.
Table 1: Fourth Quarter Average Domestic Fares from
Year-to-Year
Fares based on
domestic itinerary fares, round-trip or one-way for which no return is
purchased.
Excel | CSV
1995 |
358.71 |
|
1996 |
369.16 |
2.9 |
1997 |
392.13 |
6.2 |
1998 |
380.61 |
-2.9 |
1999 |
383.76 |
0.8 |
2000 |
407.45 |
6.2 |
2001 |
352.21 |
-13.6 |
2002 |
362.19 |
2.8 |
2003 |
363.45 |
0.3 |
2004 |
348.19 |
-4.2 |
2005 |
367.17 |
5.5 |
2006 |
379.54 |
3.4 |
Source:
Bureau of Transportation Statistics
Table 2: Air Travel Price Index and Average Domestic
Airline Fares Since First Quarter 2005
Percent Change by
Quarter
ATPI 1Q 1995=100
Fares based on
domestic itinerary fares, round-trip or one-way for which no return is
purchased.
Excel | CSV
First
Quarter 2005 |
103.90 |
|
352.71 |
|
Second
Quarter 2005 |
108.20 |
4.1 |
362.24 |
2.7 |
Third
Quarter 2005 |
109.20 |
0.9 |
359.98 |
-0.6 |
Fourth
Quarter 2005 |
111.54 |
2.2 |
367.17 |
2.0 |
First
Quarter 2006 |
114.57 |
2.7 |
381.99 |
4.0 |
Second
Quarter 2006 |
120.61 |
5.3 |
406.43 |
6.4 |
Third
Quarter 2006 |
117.43 |
-2.6 |
391.17 |
-4.3 |
Fourth
Quarter 2006 |
114.03 |
-2.9 |
379.54 |
-3.0 |
Source:
Bureau of Transportation Statistics
Table 3: Highest and Lowest Average Fares Fourth Quarter
2006
Top 100 Airports
Based on Passenger Enplanements
Fares based on
domestic itinerary fares, round-trip or one-way for which no return is
purchased.
Excel | CSV
|
Highest Average Fares |
|
1 |
Anchorage |
537.00 |
2 |
Cincinnati |
503.38 |
3 |
Honolulu |
485.06 |
4 |
San Francisco |
482.94 |
5 |
New York Kennedy |
472.86 |
|
Average
Fare at All Airports |
379.54 |
|
Lowest Average Fares |
|
1 |
Dallas Love |
235.34 |
2 |
Chicago Midway |
270.04 |
3 |
Houston Hobby |
277.46 |
4 |
Islip, NY |
292.35 |
5 |
Buffalo-Niagara |
295.58 |
Source:
Bureau of Transportation Statistics
Table 4: Percent Changes to 2006 in the Air Travel Price
Index
From Fourth Quarter Each Year Since 1995
U.S.-Origin Itineraries, Fourth Quarter to Fourth Quarter
Excel | CSV
2.2 |
2005 |
1 |
11.5 |
2004 |
2 |
7.0 |
2003 |
3 |
8.9 |
2002 |
4 |
10.9 |
2001 |
5 |
2.2 |
2000 |
6 |
12.1 |
1999 |
7 |
15.1 |
1998 |
8 |
5.8 |
1997 |
9 |
14.8 |
1996 |
10 |
15.2 |
1995 |
11 |
Source:
Bureau of Transportation Statistics
Table 5: Year-to-Year Changes in the Air Travel Price Index (ATPI) Since 1995
U.S.-Origin Itineraries Fourth Quarter
to Fourth Quarter (First Quarter 1995 = 100)
Excel | CSV
1995 |
98.96 |
|
1996 |
99.30 |
0.4 |
1997 |
107.80 |
8.6 |
1998 |
99.09 |
-8.1 |
1999 |
101.73 |
2.7 |
2000 |
111.56 |
9.7 |
2001 |
102.86 |
-7.8 |
2002 |
104.73 |
1.8 |
2003 |
106.56 |
1.8 |
2004 |
102.24 |
-4.1 |
2005 |
111.54 |
9.1 |
2006 |
114.03 |
2.2 |
Source:
Bureau of Transportation Statistics
Table 6: Quarter-to-Quarter Changes in the Air Travel
Price Index (ATPI)
For the Latest Five Quarters
U.S.-Origin Itineraries (First Quarter 1995 = 100)
Excel | CSV
Fourth
Quarter 2005 |
111.54 |
2.2 |
First
Quarter 2006 |
114.57 |
2.7 |
Second
Quarter 2006 |
120.61 |
5.3 |
Third
Quarter 2006 |
117.43 |
-2.6 |
Fourth
Quarter 2006 |
114.03 |
-2.9 |
Source:
Bureau of Transportation Statistics
Note:
Quarter-to-Quarter changes may be affected by seasonal factors
Table 7: Top Five Fourth Quarter Air Travel Price Index Increases and Decreases, 2005-2006
Top 85 Air Travel Markets
Air Travel Price Index Percent Change, Fourth Quarter 2005
to Fourth Quarter 2006
(First Quarter 1995 = 100)
Excel | CSV
|
Largest Increases |
|
|
|
1 |
Long Beach, CA |
139.23 |
161.64 |
16.1 |
2 |
Hartford, CT |
100.24 |
112.88 |
12.6 |
3 |
Providence, RI |
99.35 |
109.87 |
10.6 |
4 |
Charleston, SC |
116.93 |
128.34 |
9.8 |
5 |
Manchester, NH |
83.89 |
91.57 |
9.2 |
|
ATPI for U.S. Origins |
111.54 |
114.03 |
2.2 |
|
Largest Decreases |
|
|
|
1 |
Lihue (Kauai), HI |
222.79 |
174.93 |
-21.5 |
2 |
Kona, HI |
184.01 |
149.86 |
-18.6 |
3 |
Kahului (Maui), HI |
130.40 |
107.59 |
-17.5 |
4 |
Honolulu, HI |
149.16 |
133.02 |
-10.8 |
5 |
Charlotte, NC |
118.34 |
109.85 |
-7.2 |
Source:
Bureau of Transportation Statistics
Table 8: Top Five Air Travel Price Index Increases and Decreases (Smallest Increases), 1995-2006
Top 85 Air Travel
Markets
Air Travel Price
Index Percent Change, Fourth Quarter 1995 to Fourth Quarter 2006
(First Quarter 1995
= 100)
Excel | CSV
|
Largest Increases |
|
|
|
1 |
Long Beach, CA |
59.06 |
161.64 |
173.7 |
2 |
Lihue (Kauai), HI |
102.13 |
174.93 |
71.3 |
3 |
Burbank/Glendale/Pasadena, CA |
95.72 |
159.10 |
66.2 |
4 |
Kona, HI |
98.54 |
149.86 |
52.1 |
5 |
Phoenix, AZ |
80.18 |
120.36 |
50.1 |
|
ATPI for All U.S. Origins |
98.96 |
114.03 |
15.2 |
|
Largest Decreases/Smallest Increases |
|
|
|
1 |
Richmond, VA |
102.93 |
97.76 |
-5.0 |
2 |
Manchester, NH |
95.58 |
91.57 |
-4.2 |
3 |
Baltimore, MD |
106.02 |
104.81 |
-1.2 |
4 |
Chicago, IL |
105.12 |
105.41 |
0.3 |
5 |
Denver, CO |
97.55 |
98.73 |
1.2 |
Source: Bureau of Transportation Statistics
For indexes for the
following markets, go to http://www.bts.gov/xml/atpi/src/index.xml:
Alabama: Birmingham
Alaska: Anchorage
Arizona: Phoenix, Tucson
Arkansas: Little Rock
California: Burbank,
Greater Los Angeles, Long Beach, Los Angeles, Oakland, Ontario, Sacramento, San Diego,
San Francisco, San Jose, Santa Ana
(Orange County)
Colorado: Colorado Springs, Denver
Connecticut: Hartford
District
of Columbia: Washington, DC (Dulles and Reagan National combined)
Florida: Ft. Lauderdale, Ft. Myers, Jacksonville, Miami, Orlando, Tampa, West Palm Beach
Georgia : Atlanta, Savannah
Hawaii: Honolulu, Kahului (Maui), Kona, Lihue (Kauai)
Idaho: Boise
Illinois: Chicago (Midway and O'Hare combined)
Indiana: Indianapolis
Iowa: Des Moines
Kentucky: Louisville
Louisiana: New Orleans
Maryland: Baltimore
Massachusetts: Boston
Michigan: Detroit, Grand Rapids
Minnesota: Minneapolis/St. Paul
Missouri: Kansas City, St. Louis
Nebraska: Omaha
Nevada: Las Vegas, Reno
New
Hampshire: Manchester
New
Jersey: New
York/Newark
New
Mexico: Albuquerque
New
York: Albany, Buffalo, Long Island, New York/Newark, Rochester, Syracuse
North
Carolina: Charlotte, Greensboro/High Point, Raleigh/Durham
Ohio: Cincinnati, Cleveland, Columbus, Dayton
Oklahoma: Oklahoma City, Tulsa
Oregon: Portland
Pennsylvania: Philadelphia, Pittsburgh
Rhode
Island: Providence
South
Carolina: Charleston
Tennessee: Memphis, Nashville
Texas: Austin, Dallas/Ft. Worth, El Paso, Houston, San Antonio
Utah: Salt Lake City
Virginia: Norfolk, Richmond
Washington: Seattle, Spokane
Wisconsin: Milwaukee
Puerto
Rico: San Juan
Brief Explanation of
the ATPI
The ATPI is based on fares paid by
travelers and draws its data from the BTS Passenger Origin and Destination
Survey. Through this survey, BTS
collects information from the airlines on a 10-percent sample of airline
tickets. Each ticket sold is assigned an
identification number, and if this number ends in 0, the ticket is in the
sample.
The index measures the aggregate
change in the cost of itineraries originating in the United
States , whether the destinations are
domestic or international, but only for U.S. carriers (excluding charter air travel). The ATPI is based on the changes in
the price of individual itineraries, that is, round trips or one-way trips for
which no return trip is purchased, and the relative value of each itinerary,
for the set of matched itineraries.
The index uses the first quarter of
1995 as the reference point (expressed as the number 100) against which all
subsequent quarterly prices are measured. ATPI values below 100 represent overall "cost of flying" levels less
than those in the first quarter of 1995, while values above 100 represent cost
of flying levels that exceed those of the first quarter of 1995. ATPI levels can be used to compute percentage
changes in overall fare costs between any two quarters in an ATPI series.
Unlike many other price index
estimates, the ATPI is not based on a fixed "market basket" of air travel
services. Rather, all of the data from
the Passenger Origin and Destination (O&D) Survey are fed into the
estimation system each quarter, and this collection of itineraries varies from
one quarter to the next. New entry,
including routes and carriers, will not be included in the ATPI calculations
until it has been present in the O&D Survey for two consecutive quarters.
For price comparison
purposes, itineraries flown in each quarter are "matched up" with identical or
very similar itineraries flown in other quarters. A price index formula is then used to compute
aggregate index estimates such as those that appear in this release.
The fares reported in
the O&D Survey include taxes, so the ATPI values reflect changes in tax
rates as well as changes in fares received by the airlines. The ATPI values in
this release are not adjusted for seasonality, so some movements in the series
are due to seasonal variations in airfares.
The ATPI differs from the Bureau of
Labor Statistics' (BLS) airfare index, a component of the Consumer Price Index. The BLS index is based on fares advertised
through SABRE, a leading computerized airline ticket reservation system, while
the ATPI uses actual fares paid by travelers. Since a growing number of tickets are purchased through the internet at
discounted prices not listed with SABRE, the ATPI does not show the same levels
of increases as the BLS index.
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