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New data from the Department of Transportation (DOT) shows airfares jumped a whopping 10 percent year over year. The average airfare in the third quarter of 2010 was $340, up from $307 in the third quarter of 2009.
$340 is one of the highest third-quarter averages on record since 1995, which is as far back as available DOT data goes. Fares were only higher in 2008, when the average fare paid in the third quarter was $359.
But while fares were up compared to 2009, fares in 2010 were relatively stable through the third quarter: First quarter fares averaged out at $328; second quarter fares at $341; and $340 in the third quarter. Needless to say, it will be interesting to see how the busy holiday period influences fares in the fourth quarter.
It's also worth mentioning that while the cost of flying is relatively high right now, current prices are historically moderate, if not low. According to the DOT, a ticket today, in 1995 dollars, would cost $238. That's well below the actual cost of a ticket in 1995, which would have run you $288. Adjusted for inflation, fares have been much lower since 2004 than they were before then.
This information may put modern airfares in perspective, but it doesn't do your wallet any good. And with the advent of ancillary fees, it still feels like we're paying more than ever to fly. Indeed, airlines are earning less revenue from airfares than ever. In the third quarter, carriers made a mere 71 percent of their revenue from airfares, compared to more than 87 percent in 1995. That figure has been in steady decline since 1995, though it has dropped most sharply since 2003.
Readers, do you feel like flying is more or less expensive now than, say, five years ago?