Why Are Airfares So High Right Now?
The question everyone is asking… “Remy, why are airfares so high right now?”.
Airfares are always subject to price increases simply due to the laws of supply and demand. For the first time in two years, travel is a topic of conversation and people are keener than ever to explore after being grounded for so long. While the demand for travel is a huge reason why we are seeing prices increase across almost all airlines, another important factor is the aircraft themselves.?
After trying to navigate their way around government policies and restrictions, the reality is, airlines are cautious to bring back all of their aircraft. After having their giant jets parked for over two years due to the pandemic, airlines are now needing to rebuild their fleets.
At the beginning of May 2020, Qantas parked all of its Airbus SE A380s but as international demand rebounds, they are now looking at bringing back 10 of the jets which also happen to be the world’s largest passenger plane. This isn’t an easy job, taking up to 4,500 hours (or two months) and 10 engineers just to wake up one plane. Everything on the aircraft needs to be replaced which includes 22 wheels, 16 brakes, and all oxygen cylinders and fire extinguishers.?
Once each aircraft has had a complete revamp, it is put up on jacks in the middle of the desert where it is tested to ensure its running to the best of its ability. The aircraft is then flown to a maintenance facility where it will go through another 100 days of maintenance. As I said, this is no easy task!
Alan Joyce, the CEO of Qantas Airways has estimated that they will have six aircraft returning to their operating fleet by Christmas but all 10 of them won’t be back until well into 2024, purely due to the timing factor.
The aircraft and demand aren’t the only things that are contributing to the pushed prices of airfares. Over the past 18 months, fuel prices have rocketed to now represent as much as 38% of an average airline's costs, with an overall increase of up to 27% from pre-pandemic times. Joyce claims that “fuel prices have spiked and the fuel bill for Qantas will be $1.8 billion more than it was before COVID”.?
Fewer planes in the sky, an increase in the demand for travel and the rising operating costs for airlines are some of the main reasons you might have noticed airfares appearing to be higher than you remember them being.?
However, this doesn’t mean that there aren’t great airfares out there anymore. If you’re looking to book travel for your company, send me a message to discover how the Business First Travel team can make your next corporate trip efficient and effective.?