ARC Data Show Fare Rules Easing Up

We all know that buying an airline ticket in advance will save us lots of money. And we know that the longer the trip, the cheaper the ticket. Right? 

Maybe—but maybe not. 

Over the past couple of years, average ticket prices have become more consistent, and the old rules no longer always apply, according to analysis by the Airlines Reporting Corp.  

ARC analyzed trends in advance-purchase fares in four categories—0 to 2 days (last-minute); 3 to 7 days; 8 to 14 days, and greater than 14 days—and found that average ticket prices are indeed lower when purchased earlier, but not as much as we might think. In the top 15 business travel destinations, buying a ticket 3 to 7 days in advance saved an average of only 7%, or around $47, over a last-minute purchase.  

Last-minute buyers do pay a higher penalty—an average of more than 50%, or more than $250—compared to 14-day advance purchases. But that premium has been dropping, and the average for 2016 is $200.  

When ARC compared fares for trips of 1, 2, 3 or 4 nights, it found that differences in fares began to disappear in 2014. This year, the only short-stay premium is for overnight trips, and that has shrunk from an average of $100 to $20. 

All this is especially good news for business travelers, as many of the old fare rules were designed specifically to force them to buy higher-priced tickets. If these trends continue, corporate travel managers may want to rethink strict policies that, for example, prohibit last-minute ticket purchases.  

Still, some things haven’t changed. The average ticket prices for the top business travel destinations still peak in July, and hit a low point in December and January. The exception is Las Vegas, where the spike occurs in January.