Air travelers aren’t cruising toward a soft landing yet, but there's a big change happening in the industry ahead of the important Labor Day travel weekend.
It will be a welcome change for many people who have been trying to get back to going places after two years of covid related lockdowns and restrictions.
It will still take some time for the change to take full effect, but now is the time to start preparing.
That's because a new report from Hopper showed U.S. airline ticket prices falling by 25% in August (to an average of $286 per ticket). Air travelers shouldn’t kick back and relax just yet, as Hopper expects flight prices will rise again in September and October.
Looking ahead to the Thanksgiving-to-Christmas holiday season, Hopper estimates flight costs will continue to rise, to $368 per ticket.
Multiple Factors Driving Prices Down
Why are travel consumers getting an August break from rising flight prices? It’s a combination of factors, Hopper reports.
“Prices this summer were elevated beyond normal seasonal airfare increases by high jet fuel prices and pent-up demand coming out of two depressed summer seasons, and by traveler demand peaking earlier in the summer than in a normal year,” the company stated. “Flight prices drop seasonally in late August through mid-October, as demand tapers off following the peak vacation months in May, June, and July.”
“The drop this year is larger than usual as a result of the abnormally high summer prices and an earlier peak in demand,” Hopper added. “This fall, demand seasonality and jet fuel prices are the primary drivers of airfare.”
To land the best deals, aim for the optimal travel itinerary “sweet spots” over the next few weeks (especially for quick trips in August to leverage falling airline prices this month.).
“For those planning to travel domestically in September, plan to book by the middle of August for the best deals, while October travelers can expect to book in the next six weeks,” the report stated. “Prices will be lowest three-to-six weeks before your trip departure date, rising rapidly in the last three weeks before departure.”
International travelers should plan to book four weeks ahead of their trip, and "expect the best prices between now and a month before departure this fall,” Hopper advised.
Another big reason why airline prices are in decline this month is the lack of demand, which has helped steer prices downward.
“Demand for air travel has also dampened for two reasons: first, flying has been a nightmare due to constant flight delays and cancellations, and lost luggage has been a big issue,” said John Taylor Garner, CEO, and founder of Card Curator. “Consequently, travelers are getting fed up. The second reason is that most people who were excited to take their first trip since Covid restrictions were lifted have already taken their trips or have booked their summer vacations.”
While all the major U.S. air carriers, including American (AIR) , United (UAL) , and Delta (DAL) , along with low-cost carriers like JetBlue (JBLU) and Southwest (LUV) , are lowering prices, travelers should also take advantage of any accumulated airline rewards discounts.
“Now is a great time to cash in on airline travel rewards,” Garner told TheStreet. “However, make sure to use any flight credits, coupons, or travel banks that you've received from canceled flights during Covid first before cashing in on airline travel rewards.”
Those types of credit don’t last forever and will be expiring soon. “They also act as cash and you can use them to fully, or partially offset any ticket purchase,” Garner added.
Travel Tips for August
Americans are looking to travel before the busy Labor Day weekend need to get moving, travel experts say.
“The good news is that there are a few things you can do to increase your chances of finding a great deal,” said Matt James, founder of Visitingly.com, a travel guide blog.
Right off the bat, be flexible with your travel dates.
“If you're able to fly during the week instead of the weekend, you may be able to find a better deal,” James said. “Additionally, it's worth considering flying into an alternate airport. If your destination has more than one airport, compare fares to see if one is significantly cheaper than the others.”
It's also important to keep an eye on airfare prices in the weeks and days leading up to your trip.
“If you see a fare that's significantly lower than what you've been seeing, it's worth booking right away,” James said.