Airfares Are About to Hit Record Lows

Yahoo Travel

Thanks to low fuel prices, low demand and a DOJ investigation, airfare is about to go on sale. (Photo: iStock/Peter Booth)

Next month, domestic airfares could drop to the lowest they’ve been in four years, reports consumer advocate Christopher Elliott. The end of summer is typically a time when airfares dip anyway, but this year they’re hitting record lows.

As Elliott explains, the price of an average round-trip domestic ticket will be $245 in August, which is about 5 percent lower than it was last August — this is all according to Hopper, an airfare-data analysis company. “Prices will average about $249 through the end of the year,” he writes. “That’s about 2.8 percent cheaper than in 2014 and 6.8 percent cheaper than in 2013. All told, fares haven’t been this low in at least four years.”

What’s the reason for this unlooked-for blessing from the travel gods?

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Well, there are a few. For one, the Justice Department is currently investigating possible airline collusion, meaning the agency suspects that the major U.S. airlines are illegally coordinating with each other to make fewer seats available, thus keeping ticket prices high. Elliott suggests that, as a result, the airlines could be lowering fares to make themselves look less predatory.

A second factor is that oil prices have been decreasing — down to about $40 a barrel versus $100 per barrel this time last year.

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The third reason airfares are lowering is simply that fewer people fly at this time of year. Instead, they’re winding down their summers and getting ready to put the kids back in school. Lower demand leads to lower prices, as airlines try to entice travelers to get on planes one more time before the big holiday travel season.

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