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Airfares on the Rise

The Department of Transportation’s (DOT) Bureau of Transportation Statistics (BTS) just released airfare information for the first quarter of 2010 (January through March), which confirms what most of us already noticed or suspected: Fares are going up.

“Average domestic air fares in the first quarter of 2010 increased to the second highest January-to-March level since 2001,” the agency said in its statement, “rising 4.7 percent from the first quarter of 2009.”

The average domestic fare in the first quarter of this year was $328, compared to $313 last year. That includes a 2.3 percent rise in inflation. Still, airfare today is relatively cheap. Adjusted for inflation, today’s average fare is 25 percent lower than fares in 1999, when fares hit their inflation-adjusted high point (for all fares since 1995).

Perhaps more troubling for consumers is that Q1 2010 was the third consecutive quarter in which the DOT recorded rising overall airfares. That sustained increase correlates with the resurgence of airline profit and revenue numbers. Considering airlines haven’t added back much, if any, of the capacity they cut during the recession, it seems reasonable to expect fares will continue rising throughout 2010. According to the Associated Press, “information from other sources indicates that prices continued to rise into the summer,” and “by June, passengers were paying about 18 percent more than they did in June 2009.”

Readers, do you feel you’ve paid more or less for air travel this year?

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