Average Air Fares Dropped to All-Time Low in 2020

U.S. Department of Transportation sent this bulletin at 04/20/2021 11:27 AM EDT
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BTS 27-21
Tuesday, April 20, 2021
BTS Contact: David Smallen

Average Air Fares Dropped to All-Time Low in 2020

 

Air Fares 4Q2020 Infographic

 

 

The 2020 average domestic itinerary air fare of $292 was the lowest inflation-adjusted annual fare since the Bureau of Transportation Statistics began collecting such records in 1995, down 19% from the previous low of $359 in 2019.

In 2020, 131 million originating passengers traveled on U.S. airlines, down from 331 million in 2019.

During the year, fares dropped in the third quarter to $245, inflation-adjusted, the lowest quarterly fare on record. In the fourth quarter, fares rose to $261, up 6% from the third quarter but down 28% from the fourth quarter 2019 average fare of $361.

 

Annual Air Fares

Inflation-adjusted
Annual 2020 fare: $292
From Previous Year: Down 18.6% from 2019 ($359)
All Years: Down 42.6% from the highest fare for any year, $510 in 2000
Start of BTS records in 1995: Down 41.1% from 1995 ($496)
Recent high: Down 31.7% from 2014 ($428)

 

Unadjusted
Annual 2020 fare: $292
From Previous Year: Down 17.6% from 2019 ($355)
All Years: Down 25.4% from the highest fare for any year, $392 in 2014
Start of BTS records in 1995: Up .06% ($292) (compared to 69.8% consumer price index increase)
Recent low: Down 5.8% from 2009 ($310)

 

Air Fare 4Q2020 Fig 1

 

 

Fare calculations by BTS
Itinerary Fares: Round-trips, but includes one-ways if no return is purchased.
Breakout of trip types: one-way, 42% ($222); round-trip: 58%, ($358).

 

Based on a random sample of 10% of the tickets.
Total ticket value: The price charged by airlines at time of ticket purchase.
Included: Additional taxes and fees levied by an outside entity at time of ticket purchase.
Not included: Fees for optional services, such as baggage fees.

 

Other Revenue: In recent years, airlines have increasingly obtained additional revenue from passenger fees, as well as from other sources. U.S. passenger airlines collected 65.1% of total operating revenue of $38.6 billion from passenger fares during the first nine months of 2020, down from 88.5% in 1990.   

 

Results for average fares are based on the BTS Origin & Destination Survey, a 10% sample of airline tickets used during the quarter. For results based on all itinerary fares for 2020, the standard error is 0.18. The median fare for the year was $235.01.

 

 

Fourth Quarter 2020 Air Fares

 

The average U.S. domestic air fare in the fourth quarter of 2020 was $261, increasing 6.3% from an inflation-adjusted third quarter 2020 fare of $245. The number of passengers increased from 27 million originating passengers in the third quarter of 2020 quarter to 31 million passengers in the fourth quarter compared to 86 million passengers in the fourth quarter of 2019.

 

Adjusted for inflation (constant 2020 dollars) the average 4Q 2020 air fare was:

  • Down 27.7% from 4Q 2019 ($361)
  • Up 6.3% from 3Q 2020 ($245)
  • Down 35.0% from 4Q 2015 ($401)

 

Air Fare 4Q2020 Fig 2

 

Itinerary Fares: Round-trips, but includes one-way tickets if no return is purchased.

Breakout of trip types: one-way, 41% ($201); round-trip, 59% ($309).

 

Fourth Quarter 2020 fare: $261
Compared to all fourth quarters: Down 48.7% from the highest 4Q fare, $509 in 2000.
Compared to all quarters: Down 50.3% from the highest fare for any quarter, $525 in 1Q 1999.
Start of BTS records in 1Q 1995: Down 49.1% ($512).
Recent high: Down 39.7% from 1Q 2015 ($433). 
Recent low:  Down 6.3% from 3Q 2020 ($245).
All-time low: Down 6.3% from the previous low 3Q 2020 ($245).
All-time fourth-quarter low: Down 27.7% from the previous low 4Q 2019 ($361).

 

Fourth Quarter 2020 fare: $261
Trend: Down 6.5% from 3Q 2020 ($245)
Compared to all fourth quarters: Down 34.0% from the highest 4Q fare, $395 in 2014
Compared to all quarters: Down 35.2% from the highest fare for any quarter, $402 in 2Q 2014
Start of BTS records in 1Q 1995: Down 12.2% ($297) (compared to 69.5% consumer price index increase)
Recent low: Down 6.5% from 3Q 2020 ($245)
Recent high: Down 33.2% from 1Q 2015 ($390)
All-time low: Down 6.5% from 3Q 2020 ($245)
All-time fourth-quarter low: Down 6.3% from 4Q 1996 ($278).

 

Fares by Airport

Highest: 10 airports with 43,073-49,999 originating passengers ($298).
Lowest: 16 airports with 500,000-999,999 originating passengers ($246).

Additional data: see Top 100 Airports or All Airports. First Quarter 2021 average fare data will be released July 20. 

 

Standard error: Results for average fares are based on the BTS Origin & Destination Survey, a 10% sample of airline tickets used during the quarter. Averages for airports with smaller samples may be less reliable.

 

Note: Results for average fares are based on the BTS Origin & Destination Survey, a 10% sample of airline tickets used during the quarter. For Q4 2020 results based on all itinerary fares, the standard error is 0.30 and the median fare is $209.10. The 90% confidence interval ranges from $260.30 to $261.29. For results based on round-trip fares, the standard error is .47 and the median fare is $262.56. The 90% confidence interval ranges from $308.54 to $310.09. For results based on one-way fares, the standard error is .34 and the median fare is $158.69. The 90% confidence interval ranges from $200.00 to $201.12.