Prices for U.S. domestic flight bookings have risen steadily and a decline is not likey in the near term as travelers are facing sticker shock.
The rapid increase in demand and an increase in the costs of jet fuel and labor have thrust airline prices higher. The price of jet fuel skyrocked by 30.2% in North America compared to prices in March, according to the Platts Jet Fuel Price Index that shows the daily assessments of physical spot market prices.
Adobe tracked the prices and found that the number of domestic flights booked in March 2022 yielded $8.8 billion in online spend or a 28% percent increase compared to March 2019 spend.
The amount of money spent on flying rose by 32% compared to Feb. 2022 when sales rose to $6.6 billion.
Consumers shelled out a total of $21 billion for domestic flights online during the first 3 months of 2022, compared to the $56 billion that was spent for 2021, according to the Adobe Digital Economy Index. This index tracks direct consumer transactions from six of the top 10 U.S. airlines and over 150 billion web visits.
Prices have risen sharply and in March, they rose by 20% compared to 2019 prices and were 15% more compared to February.
Airline ticket prices were cheaper in February, when the cost was only 5% more than 2019 levels. In January, flight prices were 3% lower than 2019 levels.
Inflation is one of the major factors on why prices have risen quickly. The number of bookings has only increased by 12% due to more conference and spring break travel. The online spend in March rose by 32% while the number of bookings only increased by 15%.
“Consumers have seen online prices for physical goods rise now for 22 consecutive months, per the Adobe Digital Price Index, and inflation is becoming more prominent for services as well,” said Vivek Pandya, lead analyst, Adobe Digital Insights, in a report. “The unleash of pent-up demand has been a major driving factor, as the desire for air travel is coming back more aggressively than anticipated.”
The higher cost of flying is continuing. Bookings domestically for June 2022 to August 2022 are already rising as the online spend increased by 8% compared to the same period in 2019, while the number of bookings are up by only 3%.
There is a reduction for Memorial Day weekend - the online spend has declined by 6% percent over 2019, while the number of bookings decreased by 12%.
Consumers who have not traveled recently will face an unpleasant surprise when they shop for flights.
Travelers will face higher prices for other travel expenses.
Sally French, a travel rewards expert at NerdWallet said people need to be prepared to pay more for hotels, rental cars, food and entertainment. The cost of a rental car rose by 24% year over year.
Hotel prices are often volatile because of the seasonality of travel. The average hotel prices fell to a low of $263.25 in December 2020. but hotel prices rebounded and by July 2021, they reached all-time highs again, averaging $387.23, she said.
"Fast forward to now and hotel prices have slightly recovered from all-time highs," French said in a blog post. "Given how much seasonality plays into hotel prices, we can expect that August 2022 might also notch a new record high."
