Business travel

Study: Small U.S. Cities See Largest Airfare Increases

Secondary and tertiary markets are seeing the largest year-over-year increases in average airfares in the United States, according to a report released this week by The company assessed 128 million airline tickets in April to cities across the United States, it notes in the report.

Depending on the destination, fare increases ranged from 14% at Manchester-Boston Regional Airport to 42% at Dayton International Airport.

The study was released about a week after Airlines Reporting Corp. shared data showing the average US airfare in April jumped 45% year-over-year and was the highest average ticket price in the past seven years.

Higher airfares were announced early in the recovery due to carrier schedule changes and route curtailments, particularly in smaller regional markets, which benefited leisure destinations as demand in the generally more lucrative business travel segment was still struggling to rebound.

[Report continues below chart.]

In an earnings call in April, United Airlines CEO Scott Kirby, when asked about its regional cuts, noted that the carrier was flying “significantly fewer regional jets than in 2019, and we don’t expect that it gets any better at all in the next few years,” he said, adding that the company has about 150 regional planes grounded right now and “they’ll never come back, I guess.”

Dayton, along with Akron, Ohio, were on United’s list of route reductions announced in March and were among the top 10 cities with the highest percentage rate increases, according to the report.

United are not alone. American Airlines announced several route cuts in November, many of which included smaller markets. Delta Air Lines has also reduced 10 regional routes, according to The Points Guywhich included Des Moines, a city with one of the highest percentage rate increases.

In addition to carriers drastically reducing their schedules during the pandemic and resuming service in larger markets first, regional pilot shortages are contributing to schedule changes in smaller markets. The three largest U.S. carriers, as well as Southwest Airlines, JetBlue and Alaska Airlines, noted the challenge of hiring pilots or pilot instructors, which led to route and schedule reductions.

Additionally, the Alaska Airlines Pilots Union voted on Wednesday to allow a strike in the absence of a new pilot agreement. If this were to materialize, it could compound the negative effect on availability and higher rates to smaller markets.