Canadian Airfares Up 19% Above Pre-Pandemic Levels

Canadians are paying more for flights now than before the pandemic—but that trend could change soon due to market conditions.

A recent report from StatsCan revealed that last month’s airline ticket prices are up 19% from June 2019. The consumer price index shows a 2% rise year-over-year for June, and a 4.5% increase in May.

National Bank analyst Cameron Doerksen told the Canadian Press that airfares have been rising for most of the year, following the 11-month stretch of declines in 2023. High travel demand is a contributing factor, fueled by limited competition and flight capacity on some airlines.

These findings are a stark contrast to the industry challenges south of the border. A recent U.S. consumer price index report found that airline fares are trending downwards: falling 5% year-over-year in June, and 3.6% in May.

Canadian travelers could see some release soon, however. Doerksen predicted that WestJet may need to lower prices to win back customers following the disastrous mechanics strike cancellation chaos over the July long weekend—compounded by the Hurricane Beryl flight disruptions just one week later.

President of Toronto-based AirTrav Inc. Robert Kokonis told OpenJaw the airline fare increases are only slightly higher than inflation rates in the country, and that can be attributed to outside factors like fuel cost increases and a weak Canadian dollar.

Kokonis also predicts a shift in the near future, pointing to a decline in domestic ticket sales this fall, and Air Canada seeing lower passenger yields and average ticket prices.

“Too many seats chasing passengers,” said Kokonis. “Demand has been holding up reasonably, but it looks like we’re hitting a wall, and something has to give. Airlines can drop airfares in the short-term but may need to start taking seat capacity off domestic routes.”