This Year in Flights - 2014

Patrick Surry - Jan. 31, 2016

Summary

  • Typical domestic consumer airfare rose 3% from $326 to $336 over the past year

  • Jet fuel prices, which make up about 30% of a typical airline’s operating costs, fell nearly 33% over the same period according to IATA figures

  • 2014 also saw an estimated 17% increase in fees for add-ons like checked baggage, seat selection and food & drink, as airlines continue their strategy of “unbundling”

  • Major destinations with the greatest increase in flight prices were San Diego (10%), West Palm Beach (9%), Honolulu (9%), Baltimore (8%) and New York City (8%)

  • Only a few large destinations saw average consumer flight prices fall, including Minneapolis (down 2%), Houston (down 1%), Detroit (down 1%) and Denver (down 0.2%)

  • The top ten most popular destinations were similar to 2013 with New York City edging out Las Vegas for the top spot, and Washington DC as a new entrant displacing Seattle.

Analysis

As the year draws to a close, it’s time for Hopper’s annual roundup of this year in flights!

The top ten destinations for domestic travel in the US during 2014 are shown Figure 1 and 2, and tabulated in Table 1. New York City captured the top spot despite an 8% increase in flight prices. Most US destinations range from $250-350 with the exception of Hawaii which is just over $650. Denver, with it’s central location, is the cheapest average price, closely followed by Orlando, Chicago, and Miami.

Screen Shot 2014-12-15 at 9.44.18 AMFigure 1:  Top ten most popular destinations for 2014, showing relative search interest, along with “good deal prices”. “Good deal prices” represent the best 10% of quoted airfares (see methodology), and is weighted across domestic origins.

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Table 1: Ranking most popular US destinations by domestic consumer airfare search with change from last year.

Screen Shot 2014-12-15 at 9.47.33 AMFigure 2: Location of the ten most popular US destinations with 2014 rank.

Figure 3 shows the monthly variation in popularity and pricing across the top ten destinations.  Prices (and popularity) for most destinations peak in the summer months with end-of-year prices also high. Warm destinations also show a spike in March during spring break. Orlando and Miami show the lowest seasonal variation in prices.

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Figure 3: Monthly variation in popularity and typical pricing (normalized scale).

Finally, Figure 4 lists the top ten origins for each of the most popular destinations. The same big cities that make up the top ten destinations dominate, with the exception of Las Vegas, Orlando, and Honolulu which have huge net inflows of visitors and don’t show up as major origins. There is also some geographical variation evident. Excluding Honolulu, most top destinations are served by at least one popular origin between $150-$200. On this basis, New York looks expensive, and prices to Orlando are surprisingly constant.

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Figure 4: Top ten origins and pricing to each of the top ten destinations.  All destinations share the same price scale except Honolulu (#8).  Demand is on a normalized scale.

Data & Methodology

For this study, we looked at all domestic flights (US origin and destination) departing in calendar 2014. To focus on “good deal” consumer prices, we looked at flights that include a Saturday night stay (excluding most business travel), and measured the price in each market by looking at the tenth percentile of quoted prices (meaning that 90% of quoted prices were higher, to exclude last minute and restricted tickets).   The data presented in this analysis comes from Hopper’s combined feed of Global Distribution System (GDS) data sources which includes about 10 million flight search queries and several billion priced round trip flights per day.  Demand is represented as the number of queries not actual ticket purchases, and is calibrated across all GDS sources for each market.

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