All eyes are on the Thanksgiving travel period as a harbinger of future ticket prices. While the sky-high fuel costs that were hobbling airlines have abated, the economy has gone into a tailspin, undermining demand for travel and other non-essential goods and services.
Will the airlines respond by cutting prices? When? And by how much?
Our recent [% 2763451 | | survey %] of SmarterTravel.com readers’ Thanksgiving travel plans suggested that plenty of consumers will either be staying closer to home, traveling by car instead of flying, or not traveling at all this year. And that scenario would suggest that airlines will indeed be forced to scale back prices to keep cost-conscious flyers in the air.
A recent report by Travelocity provides some hard data on holiday airfares, confirming that prices are softening.
According to the study, “While airfares remain higher than last year, Travelocity’s Thanksgiving data report shows a decrease in domestic airfare over the past several weeks. On average, travelers can expect to pay $393 for a domestic ticket this Thanksgiving, down from $404 just three weeks ago.”
While prices are higher than they were last Thanksgiving, they are only up about 9 percent, which translates into an extra $35 per ticket. Normally, such a modest increase wouldn’t be a deal-breaker. But with consumer confidence low and falling, price-sensitivity is high and rising.
With just over two weeks to go before Thanksgiving, and with no end to the gloomy economic news in sight, there’s a strong likelihood that airfares will slip even further.
Stay tuned to SmarterTravel’s Airfare section for breaking news on newly announced airfare sales.