This report presents trends in airfares, jet fuel prices, and consumer prices from January 2015 to August 2024. 

Rachel Yuting Fan, IATA's Senior Macro Economist shares the main take aways from the document.

It serves as a practical reference for airlines, regulatory authorities, and other industry professionals by offering a clear view of historical price changes.

Airfares have risen at a slower pace than consumer prices (measured by the Consumer Price Index, CPI) over the past decade. This indicates that air ticket prices have not fully kept up with inflation, especially in comparison to jet fuel costs, which have significantly outpaced consumer inflation.

Jet fuel currently accounts for about 30% of airlines’ operating costs, and it is the largest and most volatile expense category. When airfares fail to keep pace with inflation, and with jet fuel prices in particular, it means that airlines absorb part of the cost increases on their margins rather than passing them fully onto consumers.

Global airfares declined continuously until the pandemic, when ticket prices fell sharply as the industry ground to a virtual halt. As markets reopened, ticket price rose markedly from the lows.

However, comparing airfare evolutions from this exceptional point in time only illustrates that prices fall by the wayside when the market ceases to operate and rise again when traffic resumes, telling us little about trends in airfares.

Meaningful comparisons must use a base year that excludes the covid period. This report looks at developments from 2015 and from 2019, choosing two points in time to illustrate the importance of the base-year when assessing relative evolutions (see charts above).

Both domestic and international airfares are lower today than they were in 2015, while they are higher currently than they were in 2019. In spite of airfares exceeding the 2019 level, they have increased by less than both consumer prices and jet fuel prices, meaning that airfares have fallen in real terms.

Get the report here