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Airline Mismanagement

Air tickets can typically be purchased any time between 11 months prior to travel and the date of travel itself.

Which of those 330 days is the best day to buy your ticket?  Should you buy way in advance, or wait until the last minute?

 
 
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When Should You Buy Your Airfare?

Part 2 :  How the Airlines Play the Game
 

As this image seeks to graphically depict, on any given day there are about 150,000 flights in the US.

Imagine - if you can - how many variations in fare there are on all those flights.

Part two of a three part article on When is the Best Time to Buy an Airline Ticket - please also visit

1.  Theoretical Considerations
2.  Theory Put Into Practice
3.  Web Services to Help You

 

 

Sometimes we just sort of 'know' that airfares are on a one-way trend upwards, but even that 'knowledge' can be flawed - if airfares go too high, then fewer people travel, the airlines panic, and all of a sudden they start offsetting their higher published fares with lower discounted fares.

To an extent, it sometimes seems the higher the published fares go, the lower the discounts go.

So - what to do?  There's also always a danger that if you wait too long, the flights will be full, and you'll have lost out on the waiting game.

In this, the second of three parts of this article series, we provide some general pointers as to the various factors at play here.

General Rule - But Exceptions Galore

The basic simple general rule used to be that the further in advance you booked your travel, the better the deal you'd get on your airfare.

But the wonderful (?) growth in computerization has allowed the airlines to become incredibly sophisticated at managing their seat inventory and controlling the yield they obtain from the seats they offer for sale.

The simple rule now is peppered with exceptions.  In this part of our three part series, we go through some of the exceptions and why they exist, and talk about some of the general issues associated with finding the best fare at the best time.

The Reason for the Basic Rule

The Basic Rule - the closer to travel, the more expensive the fare, and its twin - the further out you book, the cheaper the fare - was first instituted as a crude way of separating business and leisure travelers.

In simplistic terms - which applied prior to the massively sophisticated inventory and yield systems the airlines now have - the airlines used advance purchase and also a laddered series of change/cancel penalties on the basis that business travelers would pay more for (valuable to them) abilities to book close to travel dates and make frequent changes, but leisure passengers would only travel if the fares were low, and in return, they were able to lock in their dates and make bookings far in advance.

Hence the traditional scale of increasingly expensive fares (but with lower and lower change/cancel fees) the closer to travel you book.

What Are the Key Advance Cut-Off Points

There are lots of different cut-off points for advance purchase fares.  International fares typically have some types of advance purchase fare with more advance than do domestic fares.

Not all routes have fares with all levels of advance purchase, but generally you'll see a mix of fares with some of the following cut-off dates

  • 30 days

  • 28 days

  • 21 days

  • 14 days

  • 10 days

  • 7 days

  • 3 days

  • 2 days

  • 1 day

  • 0 days

It is rare to see air fares requiring a greater than 21 day advance purchase.

Waivers and Favors

Note that, in the past, it was relatively common to find travel agencies with preferred relationships with certain airlines, and part of that preferred relationship were various 'waivers and favors' - the ability to break some of the rules associated with airfares, with one such rule being the ability to break advance purchase requirements on fares - maybe without restriction, or maybe along the lines of 'you can book a 30 day fare up to 10 days prior to departure'.

These waivers and favors were also commonly built in to corporate travel contracts too.

Such arrangements are less common now, but if you research around, you might find an agency or airline (if you represent a large corporate travel department) that will still allow you some or all of the traditional waivers and favors.

Other Factors - Availability

Just because a fare exists on a pricing schedule does not mean that there are any seats available at that fare on the flight you most want to travel.

But here's the interesting thing.  The airlines change the number of seats they are willing to sell at each fare type, on a daily basis (or even more regularly).

For example, maybe when they first schedule a flight on a plane with 100 seats (typically about eleven months in advance) they might say 'We will sell up to 30 of the seats at the lowest fare, up to 50 seats at a mid/low fare, up to 80 seats at a mid/high fare, and any/all seats at full fare'.

Example 1 - Increased Low Fare Availability

Then maybe six months prior to departure, they have sold all 30 seats at the lowest fare, 15 seats at a mid-low fare and 10 seats at a mid/high fare - 55 seats in total.  This would mean the flight would now have no seats remaining at the lowest fare, 5 seats at the mid/low fare, and 25 seats at the mid high fare.

The airline's yield management system might then project that based on this level of sales so far, the flight will end up with ten unsold seats.  So it might open up ten more seats for the lowest fare, making then availability of 10 for the lowest fare, 15 for the mid/low fare, and the same numbers as before for the higher fares.

You as a potential passenger will suddenly see a lower fare (re)appear for the flight.

Example 2 - Decreased Low Fare Availability

On the other hand, the opposite could occur instead.  Maybe within a week of the flight appearing in the computer reservation systems, half the 30 cheapest fares have been sold.

This might trigger an alert in the yield management system, which thinks 'Hmmm - this flight is unexpectedly popular' and so it cuts back on the remaining cheapest seat availability, perhaps reducing it from 15 remaining down to 5 or possibly even all the way to zero.

You as a potential passenger would suddenly see the lowest fare disappear for the flight.

Regular Changes

These examples imply only occasional reviews of the flight's selling progress.  In reality, the yield management system is adjusting inventory all the time, based on how this flight is selling, on how the flights before and after are selling, and on all sorts of other parameters too.

One day the system might tighten up on inventory, the next day it might loosen it again.

It is very difficult to second guess the yield management system (although - see below - a good travel agent sometimes can), and the point we're simply making here is that a flight which appears sold out one day might become wide open the next day, and also vice versa.

Waivers and Favors

Another traditional waiver and favor that used to be offered was the ability to 'convert' inventory from one fare type to another - the ability to switch seats from a higher/more expensive type of inventory category to a lower/less expensive inventory category.

This can still sometimes be found, although not as commonly as before.

Overall Pricing Trends

A rising tide lifts all boats, or so we are told.  In the world of airfares, if there is a steady ongoing trend towards higher fares, then the longer you wait to buy your ticket, the more likely it is that the price will have increased due to across the board airfare increases.

How can you tell if fares are steadily increasing or decreasing?  It is always hard to predict the future, no matter what any type of past trend line suggests, but there are a couple of pointers as to what to expect.

Load Factors

If the load factors on flights are high and increasing, you can expect to see airfares also increase.  That is a simple expression of supply and demand - the greater the demand and less the supply, the higher the prices.

There's another aspect to supply and demand too.  Even if airfares stay the same, with higher load factors, the airlines will release fewer seats into their cheapest fare categories and hold more in higher fare categories.

So when load factors go up, air fares go up even more steeply due to the combination of overall airfare increases and reductions in the number of reduced fare tickets available for sale on each flight.

The US Department of Transportation publishes monthly statistics on load factors.  This can give you a great insight as to if the market is firm and firming, or weak and weakening.

Underlying Costs

There is a certain element of 'cost plus' even in the most sophisticated of airline pricing models.  In other words, if jet fuel is going up in cost, then sooner or later, airfares will probably go up too.

The Economy in General

In boom times, there tends to be more business travel, expense accounts are more forgiving, and people in general travel more.  Air fares go up.

In bad times, there is less travel, business travelers start to fly coach instead of first class, and fewer people travel for any reason at all.  Air fares go down.

Competition

If a new carrier starts service on a route, it is normal to see fares drop - especially if the new carrier is not a traditional 'dinosaur' carrier but rather a new low cost carrier.

Even if new service is provided by a dinosaur, and the fares remain the same, the extra capacity might see more seats pushed into the lower fare categories.

On the other hand, if an airline withdraws from a city pair, you know that the best case scenario will be for fares to stay the same, and the more likely case is for fares to rise, particularly if they'd been somewhat depressed during a fare war prior to that point.

So, keep an eye on the news related to your favorite city pairs.  If you learn of a new airline planning to start service, wait for the fares to adjust down due to the increased competitive pressure before buying your next ticket.

A Wildcard - Airfare Sales

This is a tricky factor to plan for.  We all know that airlines hold sales from time to time, and if there's a chance to fit our travel into the itineraries on sale, so much the better.

But when can we expect sales, and what periods of the year will they cover?

That is harder to say, although there are some traditional periods for sales to appear; both in terms of the travel periods on sale and the times of year when the sales occur.

And, in general, there will be more sales if the overall travel market is soft (ie lessening load factors and a poor economy) than if the overall travel market is firm.

This is another area where a good travel agent can help - if they are familiar with the destination you want to travel to, they probably know from their years of experience if and when to expect sales that might cover your travel dates.

Needless to say, an airfare on sale is probably going to be less expensive than the lowest published fare, so they are great things to take advantage of if they come along, but is it worth missing out on the lowest published fare and risking no sale appearing?

This leads to :

Risks Associated With Delaying

Each day you delay your purchase gives you one day less of options and opportunities for something good to happen, and may see your preferred flight fill up some more and available fares rise.

You might be waiting for a sale, only to have it never happen, or for the rules of the sale, when it does happen, to be such that your travel is excluded.

So at what point should you 'bite the bullet' and buy the best fare you can find?

There are a few more factors to consider so as to best answer that question.  Keep reading.

How Many Choices Do You Have

If you are flying from, for example, Los Angeles to Chicago, or from New York to London, you have a dozen or more non-stop flights to choose from, every day, and literally hundreds of flights that make one or more connections enroute.

But if you want to travel from Sacramento to Madison, or from Buffalo to Leeds, your options start to reduce.  And if you're traveling between perhaps Beijing and Pyongyang, with only one or two flights a day, your choices are minimal to start with.

Clearly, the more choices you are willing to consider, the more you should hold out for the best deal out there, because you're not likely to run into problems of suddenly finding yourself with all convenient flights full.

On the other hand, if you're facing a limited number of flights right from the get-go, and particularly if you know it to be a flight/route that regularly fills up, and/or a route with few competitors, then different rules apply and you're better advised to 'cut your losses' and to simply buy the lowest published fare and accept it for what it is - augmented perhaps by using the YAPTA service to monitor fare reductions that is mentioned in part three of this series.

Airport Choices Too

At the risk of stating the obvious, don't forget that many cities are served by multiple airports.  Not all airlines fly to all airports, and some airports are perceived as being more valuable than others.

So if you are wanting to fly, for example, between London and Brussels, don't limit your searching only to flights between Heathrow (LHR) and Brussels/Zaventem (BRU).  Consider also the other four London airports and also Brussels South Charleroi (CRL) to ensure you see all airline/airport combinations, some of which are more likely to be discounted than others.

Depending on where in each city/region you are ultimately traveling to and from, sometimes the secondary and generally cheaper airports can be actually more convenient (and easier to pass through) than the major and more expensive airports, and sometimes airlines will have special promotions to one airport but not to another.

How Flexible Are You?

If you are wanting to book flights to get you to a convention, or to connect with a cruise, then you have exact dates that you must travel on or before to get to your destination, and certain dates that you must travel on or after to return home again, so as to connect with the event/activity you are traveling to join.

But if you are simply wanting to go on vacation for a week, you may have more flexibility - it might not matter so much if it is from Monday to Monday, or from Wednesday to Wednesday, and if it is this week or next week.

Maybe even a one day change in your travel dates will be inappropriately costly to you.  If an extra night at your destination would cost you another $500 for a night in the hotel, food, and the cost of a lost day of income from your job, and if the airfare saving matching that is only $50, then clearly you are better advised to simply pay the extra $50 to the airline rather than to 'save' $50 on your airfare but incur an offsetting cost of $500 elsewhere.

On the other hand, if an extra day is a weekend day with no loss of leave or income, and if you are staying with friends rather than in a pricey hotel, there is clearly very little cost to spend an extra day at your destination, and if you can on the one hand save $50 and on the other hand enjoy another day away, then you should consider such alternate dates as may be feasible, giving you many more chances to find the lowest fare each time you check them out.

If you are more flexible, you can afford to wait longer, because you have more choices to fall back on.

Something a Travel Agent Can Tell You

So you go to an internet travel site and look up the fares to travel somewhere.  You see a range of fares currently available from perhaps $200 to $500.  But typically what you won't see is information on fares that are not currently available.

For all you know, there might be a lower $150 published fare, but which currently all the seats allocated to that fare level have been sold out.

A good travel agent can work their computer to ascertain two things - first, if there are any lower fares that in theory would apply, but which are simply sold out at present, and secondly, they can sometimes make a value judgment as to how likely it is that more seats might be released at that lower fare.

A flight that shows, to the travel agent, maximum available inventory in every fare category except the best discount fare category might have more seats released into that lower fare category.

But a flight which shows nearly all inventory classes zeroed out and only a few (less than maximum) seats remaining in the full fare codes is probably already well into its oversell profile and less likely to have more ultra-discounted seats available.

This is where a good travel agent who knows how to read and interpret a raw availability display can help you.

Not Just Published Fare Availability

One of the biggest bits of misinformation the airlines have succeeded at is causing people to believe that the best air fares are now available directly from the airlines themselves.  You'll even see bold promises such as 'lowest fares guaranteed' on some airline sites (and on some other internet travel sites too).

While this may be true when it comes to domestic travel, it is often not true for international travel.  You need to search out travel agents who specialize in the destination you are traveling to - they may have much lower contract/net/consolidator rates with airlines that never appear on any websites.

The way the guarantees work is that the websites might have the lowest published fares, but these other and lower fares are deemed unpublished.

It is sometimes possible to save 10% - 25% off the lowest published fares by seeking out sources that sell unpublished fares.

These unpublished fares often have completely different rules to the published fares - they might only apply on certain flights, and/or on certain days of the week.  They might have very different requirements for advance purchase and fees/penalties for changes, and they might or might not qualify for frequent flier miles.

They also might have a different inventory allocation than other discount fares that you see on regular airfare websites.

But it is worth the effort to hunt down sources of such tickets.  On a $1000 international fare, you might save yourself a couple of hundred dollars.  If two of you are travelling, that could be a $400 or more saving - enough to pay for the first several days at your destination, and maybe even with a bit left over for an appreciation to be sent in to The Travel Insider, too!

Web Sites That Help You Know When to Book/Buy

Knowledge is power; and in the air fare game, knowledge and the power it gives you also translates to money - either more money to the airline if they succeed in bamboozling you, or more money to you if you triumph and make the best choice of when to book.

Happily, a number of websites have appeared offering helpful information for you when you are weighing up when to buy your travel.  For more information about this, please click on to the third part of our series.

Read more in the rest of this series

This is part two of a three part article on When is the Best Time to Buy an Airline Ticket - please also visit

1.  Theoretical Considerations
2.  Theory Put Into Practice
3.  Web Services to Help You

Related Articles, etc

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Originally published 20 Apr 2012, last update 30 May 2021

You may freely reproduce or distribute this article for noncommercial purposes as long as you give credit to me as original writer.

 
 
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