Tim Leffel’s Cheapest Destinations

Are fares down, or up, or down?

Are you paying more for flights than you did seven years ago? That’s the question a new report from American Express tries to answer. It depends on how you frame the question though. Are we talking about domestic U.S. fares (down), international fares (up), or inter-European fares (down)? Here’s the bad news first, from the SmartMoney article linked above:

“International flights last year cost more than they did six years ago. In 2006, the average international fare was $1,707, compared with $1,468 in 2000.

Airlines raised ticket prices last year to cover increased operating costs - mainly for fuel. Carriers have been able to charge higher prices for international flights by restricting the number of available seats on popular routes. So far, low-cost carriers haven’t offered international flights.

Over the past two years, international fares jumped 12.8%, following several years of relatively flat rates, the American Express study found.”

The good news is, on average we’re paying less than we did in 2000 for a domestic plane ticket in the U.S., never mind inflation and rising gas prices. ” In 2006, the average price for a domestic ticket was $231, less than the $259 average ticket price in 2000.” Some would say we’re getting what we’re paying for too with the legacy airlines, but we mainly have Southwest, Frontier, and JetBlue to thank for keeping fares low and turning the value proposition upside down. (Budget airline=nicer staff, better service, and more amenities in coach.)

This picture is only half complete though since they only looked at U.S. departures. Flying within Europe or within Asia has gotten FAR cheaper than it was in 2000, with more choices too. So it might cost you more to go to one place, but it will cost you less to go to 5, 10, or 15 places on a round-the-world trip. If you don’t buy a round-the-world ticket from the big boys that is. Fill in the short hops as you go.