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Boyd Group International Reports Air Travel Cost Up Nearly 30% Since 2008; Low Cost Airline Entry no Panacea to Lower Air Fares

EVERGREEN, Colo., May 2, 2013 (GLOBE NEWSWIRE) -- The average true price of a one-way ticket has increased by nearly 30% since 2008, according to a study by Boyd Group International. The data also indicates that recruiting a "low cost" carrier to an airport may do little to lower overall fares.

The report shows that the average base one-way fare, including federal fees and taxes, increased to $219.50 in the fourth quarter of 2012, up 12.5% percent from 2008. However, the real cost is up 29.1%, due to airlines charging for commonly-used and previously-free services.

"Today, the fare is just the down-payment," noted Michael Boyd, chairman of the Colorado-based consulting firm. "It's estimated that ancillary fees for services such as first-bag check, early boarding, 'preferred' seating, etc., on average adds approximately 15% to the base fare of a one-way trip." He added that while ancillary fees are not popular, they are more consumer-friendly than traditional across-the-board fare hikes. "Airlines today are profitable largely due to the revenue streams from these fees."

Airports in the fourth quarter with the highest cost of air travel, based on fares paid per mile, included Dallas/Love, Cincinnati/Northern Kentucky, Memphis, Houston/Intercontinental, Cleveland and Tulsa.

Based on these data, airports cannot expect that recruitment of a "low-cost" airline is a panacea to high fares. In fact, of the ten highest-fare airports, eight have at least one such incumbent carrier. "Southwest captures almost 40% of the Tulsa market, yet in terms of fare cost per mile, that airport is the sixth-highest in the nation."

In the fourth quarter of 2012, Los Angeles was the nation's largest passenger airport, with almost 9.6 million local passengers. Chicago/O'Hare and Las Vegas ranked second and third, respectively. The report ranks the 100 largest airports by passengers, average ticket prices, and – most importantly - comparative cost of air travel charged on a per-mile basis.

"Comparing average ticket prices between airports is not a valid metric," the report states. The geographic location, traffic mix, length of average passenger trip and size of the market vary widely between airports, skewing simplistic ticket-price comparisons. "Newark consumers pay much less for air travel than do consumers in Tulsa – 17.3 cents per mile compared to 21.1 cents – a 22% differential – but the average passenger trip from Newark is 1,938 miles – 67% longer than the average trip from Tulsa." Therefore the average ticket spend is much higher in Newark, but the cost of the air travel is less.

The full Boyd Group International report is now available and can be accessed by logging on to www.AviationPlanning.com and clicking on the report link.

CONTACT: Michael Boyd (303) 674-2000 Boyd Group International, Inc. 78 Beaver Brook Canyon Road, Evergreen, Colorado 80439

Source:Boyd Group International