Airline fares reversed course in November, climbing 4.7 percent after three straight months of decline, according to the Consumer Price Index (CPI) for All Urban Consumers. November's airline fare increase outpaced the overall CPI, which rose 0.8 percent for the month on a seasonally adjusted basis after an increase of 0.4 percent in October, according to the Bureau of Labor Statistics.
Over the last 12 months, the index for airline fares rose a net 5.9 percent.
Over the last 12 months, the index for airline fares rose a net 5.9 percent.
Industry observers as well as frequent flyers know that the CPI's airline fare index does not necessarily reflect the all-in cost of an airline journey.
Airlines continue to focus on increasing ancillary revenue, which carries an important caveat. While the BLS's calculations of airline fares include an allowance for checked bag fees, the BLS does not include other ancillary charges which represent an ever-larger percentage of airlines' overall revenue.
Although the three major U.S. carriers announced in September 2020 that they would eliminate the fees for changing tickets, other nickel-and-dime charges remain, and the carriers continue in lock step. While American Airlines (NASDAQ:AAL) and Delta Air Lines (NYSE:DAL) quickly followed United's (NYSE:UAL) lead in abolishing change fees last year, in February 2020 United raised its fees for checked bags from $30 to $35 for the first bag, and from $40 to $45 for the second. jetBlue (NASDAQ:JBLU) quickly followed suit, while American and Delta held fast at $30 for the first bag and $40 for the second. While baggage fees are included, other similar nickel-and-dime charges are not tracked in the airline fare index.
In other areas, the monthly all items seasonally adjusted increase was the result of broad increases in most component indexes, similar to last month. The indexes for gasoline, shelter, food, used cars and trucks, and new vehicles were among the larger contributors. The energy index rose 3.5 percent in November as the gasoline index increased 6.1 percent and the other major energy component indexes also rose. The food index increased 0.7 percent as the index for food at home rose 0.8 percent.
The index for all items less food and energy rose 0.5 percent in November following a 0.6-percent increase in October. Along with shelter, used cars and trucks, and new vehicles, the indexes for household furnishings and operations, apparel, and airline fares were among those that increased. The indexes for motor vehicle insurance, recreation, and communication all declined in November.
The all items index rose 6.8 percent for the 12 months ending October, the largest 12-month increase since the period ending June 1982. The index for all items less food and energy rose 4.9 percent over the last 12 months, while the energy index rose 33.3 percent over the last year, and the food index increased 6.1 percent. These changes are the largest 12-month increases in at least 13 years in the respective series, the BLS said in its Dec. 10 statement.
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Airlines continue to focus on increasing ancillary revenue, which carries an important caveat. While the BLS's calculations of airline fares include an allowance for checked bag fees, the BLS does not include other ancillary charges which represent an ever-larger percentage of airlines' overall revenue.
Although the three major U.S. carriers announced in September 2020 that they would eliminate the fees for changing tickets, other nickel-and-dime charges remain, and the carriers continue in lock step. While American Airlines (NASDAQ:AAL) and Delta Air Lines (NYSE:DAL) quickly followed United's (NYSE:UAL) lead in abolishing change fees last year, in February 2020 United raised its fees for checked bags from $30 to $35 for the first bag, and from $40 to $45 for the second. jetBlue (NASDAQ:JBLU) quickly followed suit, while American and Delta held fast at $30 for the first bag and $40 for the second. While baggage fees are included, other similar nickel-and-dime charges are not tracked in the airline fare index.
In other areas, the monthly all items seasonally adjusted increase was the result of broad increases in most component indexes, similar to last month. The indexes for gasoline, shelter, food, used cars and trucks, and new vehicles were among the larger contributors. The energy index rose 3.5 percent in November as the gasoline index increased 6.1 percent and the other major energy component indexes also rose. The food index increased 0.7 percent as the index for food at home rose 0.8 percent.
The index for all items less food and energy rose 0.5 percent in November following a 0.6-percent increase in October. Along with shelter, used cars and trucks, and new vehicles, the indexes for household furnishings and operations, apparel, and airline fares were among those that increased. The indexes for motor vehicle insurance, recreation, and communication all declined in November.
The all items index rose 6.8 percent for the 12 months ending October, the largest 12-month increase since the period ending June 1982. The index for all items less food and energy rose 4.9 percent over the last 12 months, while the energy index rose 33.3 percent over the last year, and the food index increased 6.1 percent. These changes are the largest 12-month increases in at least 13 years in the respective series, the BLS said in its Dec. 10 statement.
Visit my main page at TheTravelPro.us for more news, reviews, and personal observations on the world of upmarket travel.
If you found this article helpful, informative and/or entertaining, please consider making a donation via PayPal to help support this private project.
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